EMPLOYEES’ PERCEPTIONS ON PRIVATIZATION OF GOVERNMENT OWNED SUGAR COMPANIES: ACASE
OF MUHORONI SUGAR COMPANY, MUHORONISCHEME, KENYA
BYODUM, WALTER OTIENO
^'VB^iry oc
°So* ~'c-«Alir
ARESEARCII PROJECT REPORT SUBMITTED IN PARTIAL FULFILMENT OF THE REQUIREMENTS FOR THE AWARD OF THE DEGREE OF MASTER
OF ARTS IN PROJECT PLANNING AND MANAGEMENT OF THEUNIVERSITY OF NAIROBI
2012
DECLARATION
This research project report is my original work and has never been submitted for
any award injmy other University or College.
SIGN.............................. ..................................... D A T E . . f a . ' . .
>UM WALTER OTIENO
L50/66445/10
This research project report has been submitted for examination with our approval
as University Supervisors.
SIGN... rti 44 A ij& r: D A T E ..^ ? ? ./.7 /^ .? ^ ? /!? rr ...........
DR. CHARLES RAMBO
SENIOR LECTURER,
SCHOOL OF CONTINUING AND DISTANCE EDUCATION,
UNIVERSITY OF NAIROBI, KENYA.
SIGN... .77.........^ ...................................... DATE.. . \" 3 . \ .9hP . .^77............
DR. PAUL ODUNDO
SENIOR LECTURER,
SCHOOL OF CONTINUING AND DISTANCE EDUCATION,
UNIVERSITY OF NAIROBI, KENYA.
ii
DEDICATION
This work is dedicated to my dear wife Eunice Awuor Otieno and children Yvonne
Houston Otieno, Hillary Odum Otieno, Walter Otieno Otieno (Jnr) and Carroll Faith
Otieno, and my late parents Mr. Zedekiah Odum Amollo and Mrs. Perish Anyango
Odum. I owe my success to their unwavering support and prayers.
111
ACKNOWLEDGEMENT
I would like to pay special tribute to my supervisors Dr. Charles Rambo and Dr.
Paul Odundo for their invaluable guidance, encouragement, and constructive criticism
that made this work possible. I am greatly indebted to them for their scholarly guidance
throughout the study. Their expertise, immense experience and consistent sacrifices
enabled me to complete the study in time. I have benefited enormously from their
feedback and insights. I also highly recognize the great contributions made by Dr.
Raphael Nyonje in my work. His input and critique on my initial ideas and work were
fundamental in shaping up the study.
I acknowledge the efforts of the entire academic staff of the University of Nairobi,
Kisumu Campus that enabled me to undertake of my studies with a lot of zeal. More
specifically, I highly appreciate the contributions of my lecturers Professor Omollo
Ongati, Dr. Ouru Nyaega, Dr. Maria Onyango, Mr. Wilson Nyaoro and Mr. Michael
Ochieng. I also recognize the University of Nairobi Kisumu Campus support staff
including Mr Michael Mboya for their many forms of valuable support that facilitated my
studies at the University.
I owe a great deal to my employers Eng. Martin O. Owiti and Mr. Kipng’etich K.
Bett, my General Manager Mr. Joshua Korir, my Heads of Departments Mr. Joel
Wang’endo and Mr. Nichanor Juma for having spared me time to partake of my studies at
the University. Special thanks are to the entire Management of Muhoroni Sugar
Company who pennitted me to conduct the study in the Company and the Company’s
employees for their active participation as respondents in the study. Also greatly
appreciated are my friends and all those who in one way or another contributed in seeing
me through this exercise. Special recognition goes to Mr. Kennedy Odhiambo Omondi,
Mr. Samwel Otieno Ondola, and Mr. Paul Omboto among many others.
Special thanks go to my dear wife Eunice Awuor Otieno and children Yvonne
Houston Otieno, Hillary Odum Otieno, Walter Otieno Otieno (Jnr) and Carroll Faith
Otieno for their encouragement and unwavering support throughout my studies at the
University of Nairobi. Finally, I thank the Almighty God for granting me good health,
strength and resources that enabled timely and successful completion of this study.
IV
TABLE OF CONTENT
DECLARATION...............
DEDICATION...................
ACKNOWLEDGEMENT
TABLE OF CONTENT...
LIST OF TABLES..............................................
LIST OF FIGURES.............................................
LIST OF ABBREVIATIONS & ACRONYMS
ABSTRACT..................................................
CHAPTER ONE..........................................
1.0 INTROD UCTION... m v p ^ f ; y •
1.1 Background of the S t u d y . , ! .'. .L.iyi.
1.2 Statement of the Problem. ..V. 'X0?.sjcn....
1.3 Purpose of the Study...............................
1.4 Objectives of the Study...........................
1.5 Research Questions..................................
1.6 Significance of the Study........................w f £*/ »
1.7 Basic Assumptions of the Study.............
1.8 Limitations of the Study..........................
1.9 De-limitations of the Study......................
1.10 Definitions of Significant Terms used in the Study
1.11 Organization of the Study.......................................
Page
......ii
......iii
..... iv
......v
...... x
....xii
.. .xiii
.... xiv
......1
......1
...... 1
....... 6
. . . . . .8
.....8
.......9
.......9
... 10
....11
.....11
.....12
.....14
v
CHAPTER TWO.............................................................................................................. 15
2.0 LITERATURE REVIEW..........................................................................................15
2.1 Introduction.................................................................................................................. 15
2.2 Employees’ Perceived Change in Conditions of Employment on
Privatization................................................................................................................. 15
2.3 Employees' Perceived Change in the Level of Participation in Decision-Making
on Privatization............................................................................................................ 18
2.4 Employees’ Perceived Change in Management-Union Collaboration/ Relationship
on Privatization............................................................................................................ 19
2.5 Employees’ Demographic Characteristics and their Perceptions on Privatization.....20
2.6 Strategies for enhanced positive Employees’ Perceptions/ Attitudes on
Privatization of State Owned Enterprises................................................................... 20
2.7 Theoretical Framework............................................................................................... 22
2.7.1 Theory of Bounded Rationality............................................................................. 22
2.7.2 Vithessonthi’s Perception Based View Model...................................................... 23
2.8 Conceptual Framework............................................................................................... 25
2.9 Summary of Literature Reviewed............................................................................... 27
CHAPTER THREE.........................................................................................................28
3.0 RESEARCH METHODOLOGY............................................................................ 28
3.1 Introduction............ ..................................................................................................... 28
3.2 Research Design.......................................................................................................... 28
3.3 Target Population........................................................................................................ 29
3.4 Sampling Procedures and Sample Size...................................................................... 29
3.4.1 Sample Size.......................................................................................................... 29
vi
3.4.2 Sampling Procedure...............................................................................................30
3.5 Research Instillments....................................................................................................31
3.5.1 Pilot Testing of the Instruments.............................................................................32
3.5.2 Validity of the Research Instruments..................................................................... 32
3.5.3 Reliability of the Research Instruments................................................................. 33
3.6 Data Collection Procedures...........................................................................................34
3.7 Data Analysis Techniques.............................................................................................35
3.8 Ethical Considerations..................................................................................................35
CHAPTER FOUR............................................................................................................ 36
4.0 DATA ANALYSIS, PRESENTATION, INTERPRETATION AND
DISCUSSIONS............................................................................................................36
4.1 Introduction...................................................................................................................36
4.2 Questionnaire Return Rate.............................................................................. 36
4.3 Demographic Characteristics of Respondents............................................................. 37
4.3.1 Distribution of Respondents by Gender & Job Title/Category..............................38
4.3.2 Distribution of Respondents by Age Bracket........................................................ 39
4.3.3 Distribution of Respondents by Highest Level of Education................................40
4.3.4 Distribution of Respondents by Work Experience................................................41
4.4 Employees’ Perceptions and Attitudes on Privatisation..............................................42
4.4.1 Employees’ Perceived Change in Conditions of Employment on Privatisation
of Muhoroni Sugar Company Limited.................................................................. 43
4.4.2 Employees’ Perceived Change in the level of Participation in decision-making
on Privatisation of Muhoroni Sugar Company...................................................... 47
Vll
4.4.3 Employees’ Perceived Change in Management-Union Collaboration
/Relationships on Privatisation of Muhoroni Sugar Company............................. 53
4.4.4 Employees’ Characteristics and their Perceptions on Privatisation of
Muhoroni Sugar Company Limited....................................................................... 56
4.4.5 Measures for enhanced employees’ positive perceptions and attitudes
on privatisation of Muhoroni Sugar Company Limited......................................66
4.5 General employees’ views and awareness levels on privatisation.............................69
4.5.1 Employees’ awareness and levels of sensitization on the planned privatisation
of Muhoroni Sugar Company................................................................................ 69
4.5.2 Employees’ views on the relevance of privatisation as a public sector
reform policy for the Kenyan Sugar Industry........................................................ 70
4.5.3 Employees’ views on what they consider the main reason for the privatisation
of Muhoroni Sugar Company................................................................................ 72
CHAPTER FIVE.............................................................................................................74
5.0 SUMMARY OF FINDINGS, CONCLUSIONS AND
RECOMMENDATIONS............................................................................................74
5.1 Introduction...................................................................................................................74
5.2 Summary of Findings....................................................................................................74
5.3 Conclusions...................................................................................................................77
5.4 Recommendations................................................................... 79
5.5 Contributions to the Body of Knowledge.................................................................... 81
5.6 Suggestions for Further Research................................................................................ 83
via
APPENDICES........................................................... ...................................................... 92
Appendix I: Letters of Transmittal.................................................................................... 92
Appendix II: Questionnaire................................................................................................ 94
Appendix III: Sample Size Determination Table............................................................ 100
Appendix IV: Authorization Letter...................................................................................101
Appendix V: Research Permit..........................................................................................102
REFERENCES................................................................................................................84
%
ix
LIST OF TABLES
Table 3.1 Sample Stratification....................................................................................31
Table 4.1 Questionnaire Return Rate...........................................................................37
Table 4.2 Distribution of Respondents by Gender & Job Title/Category...................38
Table 4.3 Distribution of Respondents by Age bracket.............................................. 39t*
Table 4.4 Distribution of Respondents by Highest Level of Education.....................40
Table 4.5 Distribution of respondents by years of work experience in Muhoroni
Sugar Company.......................................................................................... 41
Table 4.6 Responses on Perceived Change in Conditions of Employment................44
Table 4.7 Responses on perceived change in levels of involvement in decision
making (operational issues).......................................................................49
Table 4.8 Responses on perceived change in levels of involvement in decision
making (Strategic/Departmental issues)...................................................51
Table 4.9 Responses on Perceived change in Management-Union
Collaboration/Relationships...................................................................... 54
Table 4.10a Response distribution by respondent’s Level of Education on
Conditions of Employment........................................................................57
Table 4.10b Response distribution by respondent’s Job Title/Category on
conditions of employment......................................................................... 59
x
Table 4.10c
Table 4.1 Od
Table 4.10e
Table 4.11:
Table 4.12a
Table 4.12b
Table 4.12c
Response distribution by Job Title/Category, Gender, Level of
Education, Age and Working experience on employee awareness........... 61
Response distribution by Job Title/ Category, Gender, Level of
Education, Age, & Working experience on employee sensitization......... 63
Response distribution by Job Title/Category & level of Education
on the necessity of privatization for Kenyan Sugar Industry................... 65
Responses on Measures for enhanced employees’ positive perceptions
and attitudes on privatization..................................................................... 67
Responses on employees’ awareness and adequacy of employee
sensitization on privatization of Muhoroni Sugar Company Limited.....69
Responses on the necessity of privation as a public sector reform
Policy for Kenyan Sugar Industry............................................................. 71
Reasons for the privatization of Muhoroni Sugar Company...................72
OMIVERSITY or f/gffgf
3 0.NAIROBI
LIST OF ABBREVIATIONS AND ACRONYMS
GoK Government of Kenya
KSB Kenya Sugar Board
MOA Ministry of Agriculture
PC K Privatization Commission of Kenya
E.A East Africa
IMF International Monetary Fund
WB World Bank
CEE Central and Eastern Europe
UK United Kingdom
SOEs State Owned Enterprises
SCRP State Corporations Reform Programme
PERP Public Enterprises Reform and Privatization
KTUF Kuwait Trade Union Federation
MMS Mumias Sugar Company
MUSCO Muhoroni Sugar Company
KCB Kenya Commercial Bank
KQ Kenya Airways
GoU Government of Uganda
SOSCs State Owned Sugar Companies
PBV Perception Based View
TBR Theory of Bounded Rationality
Ltd Limited
Mngt Management
xm
ABSTRACTPrivatization refers to the transfer of state activities into the private sector by sale
(fully or partially) of going concerns or sale of assets following liquidation. There is little empirical evidence on employees’ perceptions and the associated implications on privatization of state owned enterprises (SOEs) in Kenya and more particularly in the Sugar Industry on the planned privatisation of the state owned Sugar Companies, a gap this study has contributed to. Concerns emanating from employees’ perceived change in conditions of employment; employees’ perceived change in management-union relationships/collaboration; and employees’ perceived change in the level of participation in decision-making influence their attitudes on the planned privatization negatively and if not addressed may pose potential danger to the implementation process. This study sought to explore employees’ perceptions on privatisation of Government owned Sugar Companies: A case of Muhoroni Sugar Company. The research was anchored on both the Theory of Bounded Rationality and Vithessonthi’s Perception Based View Model. A descriptive survey design was used in the study to seek the views of 248 employees randomly chosen from the target population of 714 Muhoroni Sugar Company employees. A self-administered questionnaire was used in the study for data collection. The collected quantitative data was analyzed using descriptive statistics based on frequency distributions and percentage counts while qualitative data was organized into various immerging themes of the study and reported narratively. Microsoft Excel and Statistical Package for Social Sciences (SPSS) were used as tools of data analysis. The study found that 132(62.96%) of the respondents who participated in the study perceived a negative change in their conditions of employment upon privatization of Muhoroni Sugar Company Ltd. It was also found that 191(90.95%) of the respondents projected a decline in the level of employee involvement in the firm’s decision making once the Company is privatized. The study further established that 181(86.19%) of the respondents anticipated a decline in the management-union relationship upon privation of the Company. It was also found that the respondents’ responses in the study were significantly influenced by their job category and level of education. Based on the findings of the study, the study concludes that majority of Muhoroni Sugar Company employees hold a negative perception on the planned privatization of the Company. The study also concludes that the employees’ negative perception is largely informed by the anticipated unfavorable changes in conditions of employment and management-union relationship once the Company is privatized. The study further concludes that employees’ perceptions on the planned privatization of Muhoroni Sugar Company are significantly influenced by their level of education and job category. Finally the study concludes that the negative perception established if not addressed may adversely affect the privatization process implementation in the Organisation. The researcher has highlighted the study’s contributions to the body of knowledge and acknowledged key sources of information used in the study. The study has also recommended strategies and mitigation measures that could be deployed to address the expressed employees’ concerns on privatization as a public sector reform policy for enhanced positive perception, acceptability and effective implementation of the process. Finally, the study has suggested areas for further research for a deeper understanding of the subject of investigation and greater generalization of the findings.
xiv
CH APTER ONE
INTRODUCTION
1.1 Background of the Study
Privatization has been perceived by various researchers as a means of reducing the
role of government from direct service provision and to encourage private sector
participation and competition (Sheshinski and L6pez-Calva, 2003). Madzikanda and
Njoku (2008), view privatization as an act of converting previously public owned assets,
activities or service delivery to private ownership and management, with little
government involvement except in setting up standards and regulatory mechanism to
protect the interests and safety of the public as well as creating a conducive environment
to improve efficiency and effectiveness. Generally put, privatization is a change process
of transferring the ownership (or government jurisdiction) of a public business from a
public department to a private department.
After several decades of poor performance and inefficient operations by state-owned
enterprises (SOEs), governments all over the world earnestly embraced privatization for
enhanced efficiency and productivity (Chong and Lopez, 2003). An estimated 75,000
medium and large-sized state owned enterprises have been divested around the world
(Wood, 2004), In the United Kingdom (UK), privatization of several national assets took
place under Margaret Thatcher’s administration in the 1980s. Developing countries have
slowly been privatizing government owned entities mainly under pressure from
institutions such as the World Bank (WB) and the International Monetary Fund (IMF)
(Eurodad, 2006). In the early 1980s, Brazil & Jamaica like many other Latin American
countries began to question the rationale for public ownership since the performance of
1
A World Bank study on Privatization in Africa by Campbell and Bhatia (1998)
reported that nearly 2,700 privatization transactions had taken place in sub-Saharan
Africa by the end of 1996. Zambia for example, ventured into a major privatization
exercise as part of its economic reform program in 1992 (Eeamest, 2000). In the East
African region (EA), Uganda embarked on the privatisation of her state owned
enterprises in 1993 leading to the privatisation of over 105 state owned enterprises
(Ssentamu & Mugume, 2001) while Rwanda privatised Kabuye Sugar Works in 1997
(Ansoms, 2009).
Kenya like many other African Countries was never left behind in the privatisation
of state owned enterprises. Since independence in 1963, there have been major policy
changes in Kenya regarding direct public sector participation in commercial activities
through SOEs. Arising from the Sessional Paper No.4 of 1991 on Development and
Employment in Kenya that decried the continued deterioration of the performance of
state corporations and underlined the need to implement privatization/divestiture of State
corporations, the Government of Kenya (GoK) initiated a comprehensive State
Corporations Reform Programme (SCRP) in 1992. The Programme implementation
began in July 1992 with the issuance of Policy Paper on Public Enterprises Reform and
Privatization (PERP) in which the government outlined the scope of the programme, the
institutional framework and the guidelines and procedures to be applied in privatizing
state corporations comprising of 207 non-strategic and 33 strategic state-owned
commercial enterprises.
state-owned enterprises was disappointing while in Asia, Japan had adopted privatization
by mid 1980s.
2
During the first phase of the program, the Kenyan government privatized a number
of small and medium enterprises. Among the non-strategic SOEs, the Government
divested 168 enterprises of the original 207 SOEs slated for divestiture (Privatization
Commission, 2008). Generally put, the Kenyan privatization programme which began
with small state owned enterprises has since advanced to larger and more strategic
government owned enterprises including the Sugar subsector. As per the SCRP schedule
for the sugar subsector, there are five remaining Government owned Sugar Companies
targeted for privatization in the second (current) phase of the programme, namely;
SONY, MUHORONI, CHEMELIL, NZOIA and MIWANI Sugar Companies.
However, the privatisation initiatives worldwide have however not come without
opposition. According to Birdsall and Nellis (2003), privatization has never been a
popular reform policy and much of the criticism is based on the (negative) perception that
privatization has been unfair to the poor and the workers but only beneficial to the
privileged. It is perceived to throw the masses out of work or forces them to accept jobs
with lower pay, less security, and fewer benefits thus making the rich richer and the poor
poorer (Ssentamu and Mugune, 2003). However, the stakeholders’ perceptions and
reactions to privatisation initiatives based on its actual and perceived implications are
varied worldwide.
In Latin America, public support for privatization has dropped more quickly than
in any other region, leading even to violent demonstrations (Wood, 2004). The Latin-
Barometor (2001) findings showed that negative perceptions about privatization had
increased greatly in certain Latin American countries (e.g. Argentina, Brazil, and
Colombia) and that in all the 17 countries surveyed, the percentage holding a negative
3
perception had grown significantly based on the perceived loss of national sovereignty
and the common belief that privatization leads to increased unemployment (Wood, 2004).
Similar expressions of popular dissatisfaction with privatization, of equal or greater
magnitude, were found in transition countries generally and Russia in particular (Nellis
and Birdsall, 2003).
In Asia, the Kuwait government faced strong opposition on its privatization
initiatives from workers’ unions (such as the Kuwait Trade Union Federation (KTUF))
based on its perceived adverse impacts on employees (Arab Times, 4th May 2006).
Research findings from a study conducted on the employees’ attitudes towards the
privatisation of Kuwait’s state owned enterprises showed that the employees’ attitudes
was overwhelmingly negative and that their attitudes were largely influenced by concerns
on the perceived changes in the employment system, in particular job security, and the
impact of privatization on the localisation of the industry (i.e. replacing foreign workers
with Kuwaiti employees) (Madzikanda and Njoku, 2008).
Regionally, studies on privatisation in Uganda have indicated that concerns have
been raised by workers unions and civil societies that privatisation has hurt the socio
economic welfare of the majority and that benefit has gone almost entirely to the
managers of the process resulting into the feeling that locals and workers have been
robbed of national assets built through accumulation of Taxpayers' contributions
(Ssentamu and Mugume, 2001). In the same vain, privatisation as a public reform policy
in Kenya has elicited divergent views and reactions from various stakeholders in the
sense that whereas it yearned for by some, it has proved to be a threat to others (Okumu,
2009).
4
On the other hand, several studies have been conducted worldwide on the
privatisation of SOEs and empirical evidence from studies conducted in the late 1980s
make a strong case for the ability of privatization programs to increase the efficiency and
productivity of the privatised SOEs (Wood, 2004). However, while the impact of
privatisation on the performance of state owned enterprises with regard to efficiency and
productivity improvements has been extensively investigated (Martin and Parker, 1997;
Shleifer, 1998), the relationship between privatisation and the firm’s work environment
particularly with regard to the employees has received less attention (Megginson and
Netter, 2001) even as researchers and practitioners posit that employees reactions to
change have critical implications for successful change implementation and the firm’s
performance (Kotter and Cohen, 2002). It is thus apparent that very little attention has
been given to the employees’ perceptions on privatization and the associated effects of
such perceptions on the privatization implementation process, a literature gap that this
study hopes to contribute to.
In Kenya, similar studies have focused on the impact of privatisation on the
performance (efficiency and productivity) improvements of the already privatised firms
such Mumias Sugar (MMS), Kenya Commercial Bank (KCB), and Kenya Airways (KQ)
(Okumu, 2009), leaving a knowledge gap as to what perceptions employees as key
stakeholders hold of privatisation and the effects/implications that such perceptions might
have in terms of acceptance and successful implementation of the privatization programs
for the remaining state owned enterprises including the five Sugar Companies. A gap this
study seeks to fill.
5
Muhoroni Sugar Company (MUSCO) Limited is one of the five state owned Sugar
Companies (SOSCs) currently programmed for privatisation amidst divergent views from
the Company’s employees and other stakeholders. The Company is owned at 74% by
GOK through ADC, 16.9% by UKETA, 8.6% by Development Bank of Kenya and 0.3%
by other shareholders. As at 31 st March 2004 the Company had Non-Current assets of
Kshs.609.2 million, Current assets of Kshs.542.1 million against Current liabilities of
Kshs.1.1 billion and Long Term Loans of Kshs.6.01 billion. In this respect, the Company
is insolvent and requires urgent restructuring. Restructuring and privatization will address
the excess debt and the financial and management resources required by the company for
enhanced performance and efficiency.
1.2 Statement of the Problem
Privatization initiatives worldwide have not come without opposition from
different quarters based on negative perceptions and attitudes held by such stakeholders
(Birdsall and Nellis, 2003). In Latin America for example, Latinbarometer (2001) results
showed that negative perceptions about privatization had increased greatly in several
countries including Brazil, Argentina, and Colombia. Nellis et al. (2004) observed that
opposition to privatisation arising from negative perception turned violent in Bolivia
(leading to the cancellation of concession) and in Peru (where the sale was abandoned).
In Asia, the Kuwait government faced strong opposition on its privatization
initiatives from workers’ unions (such as the Kuwait Trade Union Federation (KTUF))
based on the perceived adverse impacts on employees (Arab Times, 4th May 2006).
Research findings from a study conducted on the employees’ attitudes towards the
privatisation of Kuwait’s state owned enterprises showed that employees attitudes
6
towards privatization was overwhelmingly negative (Madzikanda and Njoku, 2008) and
regionally, in Uganda concerns have been raised by workers unions and civil societies
that privatisation has hurt the socio-economic welfare of the majority and that benefit has
gone almost entirely to managers of the process (Ssentamu and Mugume, 2001).
In Kenya, the planned privatisation of the five sugar Companies has elicited mixed
views and reactions both from employees and other sugar industry stakeholders with each
holding divergent opinions on the public sector reform policy mainly based on what they
perceive of the process and its likely impacts on their interests. The employees’ concerns
emanating from perceived change in: conditions of employment; management-union
relationships/collaboration; and level of employee participation in decision-making if not
addressed may influence their attitudes on privatization negatively.
In spite of the importance of these concerns, labour based issues raised on the
planned privatization of the state-owned Sugar Companies in Kenya have attracted very
limited attention despite their great potential to delay, render ineffective or completely
derail the entire process bringing it to a halt. It seems only very limited studies (if any)
have been conducted in Kenyan on employees’ perceptions on privatisation of state
owned Sugar Companies. It therefore follows that employee perceptions and attitudes on
the planned privatisation of the five Sugar Companies need to be understood in order to
curtail the concerns of government and workers alike for a smooth and effective
implementation of the process.
Consequently, a study of employees’ perceptions on privatisation of Muhoroni
Sugar Company Limited may broaden the scope of investigation of privatization in
Kenya for a better understanding, enhanced privatization acceptability, and effective
7
implementation of the process. Interactions with the Company’s employees revealed
divergent opinions on what they perceive of the planned change process (privatisation) in
the sense that whereas some employees raised concerns and expressed their fears on the
Government led process, others voiced support for the move. It is against this background
that this study sought to explore employees’ perceptions on the planned privatisation of
Muhoroni Sugar Company Limited.
1.3 Purpose of the Study
The purpose of this study was to explore employees’ perceptions on privatization
of Government owned Sugar Companies: A case of Muhoroni Sugar Company Ltd,
Muhoroni Scheme, Kenya.
1.4 Objectives of the Study
This study sought to achieve the following objectives:
1. To establish employees’ perceived change in conditions of employment on
privatisation of Muhoroni Sugar Company Limited.
2. To explore employees’ perceived change in the level of participation in
decision-making on privatisation of Muhoroni Sugar Company Limited.
3. To establish employees’ perceived change in Management-Union
collaboration or relationships on privatisation of Muhoroni Sugar
Company.
4. To examine the extent to which employees’ Demographic Characteristics
influence their perceptions on the planned privatisation of Muhoroni Sugar
Company.
8
5. To suggest suitable strategies and mitigation measures that can be
employed to address the employees’ concerns for enhanced positive
perceptions, attitude and acceptability of the impending privatisation
Muhoroni Sugar Company.
1.5 Research Questions
The study sought to answer the following research questions:
1. What is the employees’ perceived change in conditions of employment on
privatisation of Muhoroni Sugar Company?
2. What is the employees’ perceived change in the level of participation in
decision-making on privatisation of Muhoroni Sugar Company?
3. What is the employees’ perceived change in Management-Union
collaboration or relationship on privatisation of Muhoroni Sugar
Company?
4. To what extent do employees’ Demographic Characteristics influence
their perceptions on privatisation of Muhoroni Sugar Company?
5. What suitable strategies and mitigation measures can be employed to
address the employees’ concerns for enhanced acceptability and positive
perception/attitude on the impending privatisation of Muhoroni Sugar
Company Limited?
1.6 Significance of the Study
This research study sought to gain insights and understanding on the perceptions
and attitudes of employees on the planned privatisation of government owned sugar
Companies and the associated implications on the implementation process. The study was
9
hoped to bring out employees’ perceptions, attitudes, concerns or fears, expectations and
wishes on the planned privatisation of Muhoroni Sugar Company Limited. Armed with
the knowledge and understanding of employees’ perceptions/attitudes on the planned
privatisation initiative, the Kenyan Government (GoK), Kenya Sugar Board (KSB),
Privatisation Commission of Kenya (PCK), other privatization planners, policy
implemented and stakeholders of the process (including potential investors) can
configure ways to alleviate the fears that employees might have against the public sector
reform policy and formulate appropriate and effective privatisation implementation
strategies. As the riots in Bolivia and elsewhere has shown, people need to be convinced
that privatization will improve their lot in life, and will accept nothing less (Wood, 2004).
It is thus hoped that the study has identified key factors that shape the employees’
perceptions and attitudes and has recommended suitable mitigation measures which may
be taken to address such concerns for enhanced acceptability of the programme. Findings
of this research is therefore hoped to inform suitable policy and strategy formulation
necessary for an enhanced and effective privatization implementation process that is
acceptable to the majority of the employees. The study has contributed to the existing
body of knowledge and has provided a basis for further research. It is also hoped that the
study has filled the information gap which existed in the area of study.
1.7 Basic Assumptions of the study
The study was guided by the following basic assumptions: that the respondents
were informed and gave accurate information to help attain the objectives of the study;
that the instruments used and the sample size chosen gave fair representation of the target
population; that the respondents picked had varied perceptions on the planned
10
privatization of Muhoroni Sugar Company Limited; that all the respondents chosen for
the study willingly participated in the exercise; that the respondents gave the desired
infonnation without bias and that the stakeholders’ politics did not influence their
responses.
1.8 Limitations of the Study
It was necessary to translate some questionnaire content into Kiswahili in certain
instances and this might have distorted the meaning of certain questions. However to
reduce this undesired effect, the researcher used competent translators who were
conversant with Kiswahili language where necessary. The researcher also feared that
some of the respondents might have been biased in their responses thus skewing the
information obtained. The researcher however reduced this limitation by clarifying to the
respondents the purpose and objectives of the study and emphasized to them on the need
for factual responses.
1.9 Delimitations of the Study
The study was carried out at Muhoroni Sugar Factory premises situated in
Muhoroni Scheme, Nyando Sugar Belt in Kisumu County about 325km to the West of
Nairobi. The study was delimited to the employees of Muhoroni Sugar Company Limited
and it targeted all the 714 regular Company employees about 29% of which were
management staff comprising of senior and lower management.
Muhoroni Sugar Company was identified for this study given that it’s the oldest
operational Sugar Company in Kenya today and is currently faced with numerous
challenges attributed to its age, level of technology and location which has made the
11
programmed privatization of the Company apriority and a critical survival strategy going
forward much more so compared to the other relatively newer (modem) Sugar
Companies also targeted for privatization. On the other hand, there have been incidences
in the past where potential investors were denied entry into Muhoroni Sugar Company
premises on account of unfavorable beliefs about privatization by employees and other
stakeholders which further qualified the need for this study in the Company.
The study adopted a descriptive survey research design with both qualitative and
quantitative approaches and the use of a self-administered semi-structured questionnaire
for data collection.
1.10 Definitions of Significant Terms as used in the Study
Perceived Change - Expected change that will take place in Muhoroni Sugar Company
as a result of Privatisation of the Company.
Employees’ Conditions of Employment - Conditions of employment in Muhoroni
Sugar Company limited.
Employees’ Level of Participation in Decision-Making - The level of employees’
involvement in decision
making in Muhoroni Sugar
Company Limited.
Management-Union Collaboration/Relationship - The way management and
employees’ union relate to each
other in Muhoroni Sugar Company.
Demographic Characteristics - An individual employees’ personal characteristics that
defines him/her uniquely.
12
Privatization - A method and process of transferring through legal means the functions,
roles, mechanisms or management right, ownership, etc., originally
belonging to a Public department to a private organization for the latter
to replace all or part of Government functions for the sake of improving
performance.
Perception - A complex process by which people select, organize, and interpret
sensory stimulation into a meaningful and coherent picture of a situation
or the world around them performed within the limits of the mind and
informs one’s attitude.
Attitude - A learned predispositions to respond in a consistently favourable or
unfavourable manner with respect to a given object, situation or person.
Negative Perception - A negative mental picture of a situation, condition or process that
informs an individual’s unfavourable attitude of the situation or
condition.
Positive Perception - A positive mental picture of a situation, condition or process that
informs an individual’s favourable attitude of the situation or
condition.
Employees - Workers employed by and working for Muhoroni Sugar Company
Limited.
State Enterprises - Government of Kenya owned Limited Companies.
13
1.11 Organization of the study
The study was organized into five chapters; chapter one gives an introduction and
describes the background of the study, statement of the problem, purpose of the study,
objectives of the study, research questions, significance of the study, basic assumptions
of the study, limitations of the study, delimitations of the study, definition of significant
terms used in the study and organization of the study. Chapter two provides a review of
literature related to the study thematically based on the research objectives, the
theoretical frame work, the conceptual frame work as well as the summary of literature
reviewed. Chapter three focuses on the research methodology discussed under the
following sub-headings; Research design, target population, sample size, sample
selection, research instruments, pilot testing of the instruments, validity of research
instruments, reliability of research instruments, data collection procedures, data analysis
technique and ethical issues considered in conducting this research. Chapter four covers
data analysis, presentation and interpretation while chapter five contains a summary of
research findings, conclusions, recommendations, suggestions for further research and
contributions of the study to the body of knowledge.
14
CHAPTER TWO
LITERATURE REVIEW
2.1 Introduction
This chapter explores the general and empirical literature related to the study. The
general literature reviewed comprised of journals, presentations, and publications
whereas the empirical literature comprises researches done and documented by other
scholars on the subject matter. The literature review covers the following thematic areas:
Employees’ perceived change in Conditions of Employment with Privatisation;
Employees’ perceived change in the Level of Participation in Decision-Making with
Privatisation; Employees’ perceived change in Management-Union Collaboration or
Relationship with Privatisation; Employees’ Personal Characteristics and their
perceptions on Privatisation; and Strategies for enhanced positive employees’ perceptions
on Privatisation of SOEs. The theoretical and conceptual frameworks on which the study
shall be anchored are also identified.
2.2 Employees’ Perceived Change in Conditions of Employment on Privatisation
Previous studies have shown that due to a lack of effective product market
competition, high levels of unionisation, and political intervention, public sector
enterprises are commonly associated with overstaffing and wage premiums (Boycko,
1996; Florio, 2004). However, in the period surrounding privatisation, firms often create
once-off or static efficiency gains through a reduction in this excess employment and
earnings premium (La Porta and Lopez-de-Silones, 1999; Parker and Martin, 1996).
According to Birdsall and Nellis (2003), Worldwide, more people have lost, rather than
have gained jobs through privatization over the short term mainly because public
15
enterprises were overstaffed, often severely so. Moreover, in preparing for privatization,
public enterprise employment numbers have declined, sometimes greatly, and such
declines have generally continued after privatization.
Anecdotal evidence quickly seized upon by the masses as well as the popular press
indicates that privatization leads to nearly immediate job losses and since this affects the
population whose main source of income is wages, the result is increased income
inequality and disgruntled workers. For example, privatization in Latin America led to
the loss of several jobs; in Argentina, privatization between 1987 and 1997 led to the
loss of 150,000 jobs ; in Mexico privatization of public enterprises was followed by the
dismissal of 50% of the workforce; in Brazil, the privatization of railways led to a
reduction of more than 90,000 jobs, and in Nicaragua, the privatization that resulted as
part of a government-led transition from a command-economy to a market economy led
to the dismissal of 15% of the labor force (Nellis et al. 2004).
Privatization will shake out surplus and inefficient labour and thus negative
employment effects around the time of privatization are expected (Wood, 2004). A shake
out effect would be necessary in order to remove excessive redundancies and derive
efficiency gains unless the government intervenes to protect employees (Birdsall and
Nellis, 2003). A survey of 308 privatized firms in developing countries shows post-sale
employment reductions in 78.4% of cases, with no change or job gains in the rest (Chong
and Lopez-de-Silanes, 2002). In a study conducted in Kuwait, Madzikanda and Njoku
(2008) observed that post privatized firms streamline their operations and in the process
reduce the labour force in order to improve efficiencies.
16
On the other hand, Public sector firms are also associated with high levels of
employment security and the use of formal work procedures and practices. However,
following privatisation with the aim of securing long-term efficiency and increased
productivity, finns may significantly change employee work-patterns or introduce high
performance work mechanisms (Femer aid Colling, 1991). Given an initial condition of
over-employment, one can thus assume that upon privatizing a state-run industry, the
workforce will experience a reduction in numbers as the new owner improves the
efficiency of the production process (Bhaskar and Khan 1995). It is further observed that
in the event of a “no-layoffs” agreement, employees of privatized SOEs can be dismissed
at management’s discretion (Dereli and Isik, 1993).
According to Wood (2004), resulting changes in the conditions of employment
such as increased workload & pressure, increased hours worked, reduced job security and
employee benefits can have a direct and often negative impact on how employees
perceive changes in their conditions of employment, especially where employees have
made large non-diversifiable investments in their human capital. He further observed that
changes in conditions of employment, especially those that impact on an employee’s
immediate work environment (e.g. pay and hours worked), can have a significant impact
on employee commitment and attitude towards privatisation. Where employees feel
management have allowed conditions to deteriorate as a result of privatisation, they can
be expected to reciprocate through reduced commitment and poor performance (Coyle-
Shapiro and Kessler, 2000). Mazikanda and Njoku (2008) in their study on privatisation
in Kuwait found that employees perceived a negative change in the employment system
due to privatization. At the heart of much of the criticism is the belief that privatization
17
has been unfair; - hurting the poor, the disenfranchised workers and only benefiting the
privileged and powerful. Privatization, it is claimed, throws masses of people out of work
or forces them to accept jobs with lower pay, less security, and fewer benefits, provides
opportunities to enrich the agile and corrupt; and generally makes the rich richer and the
poor poorer (Birdsall and Nellis, 2003).
In view of the above, it can be summarised that concerns about conditions of
employment (i.e. job security, work load, salary, progression (recruitment and
promotion)) influence perceptions and attitudes of workers on privatization negatively
with possible negative implications on the implementation process. These concerns of
employees need not be neglected if a successful and smooth privatization is to be
implemented.
2.3 Employees’ Perceived Change in the Level of Participation in Decision-Making
on Privatisation
Public sector firms are typically characterised by rigid pyramid-style managerial
structures, functional department structures, and a centralised decision-making process.
Privatisation often involves a reduction in the number of managerial layers, the
decentralisation of decision-making authority, and the establishment of market-based
business units (O'Connell, 1993). Such reforms through the creation of more clearly
defined and quantifiable performance targets provide lower level managers with an
incentive to more closely supervise and control employee decisions. This may result in
reducing employees’ sense of participation in decision-making, particularly at the
workplace level.
18
Privatisation also affects the ability of trade unions to act as an effective voice of
employee opinion. Management can be expected to adopt a harder line with trade unions
as they seek to implement firm restructuring during the privatisation process
(Arrowsmith, 2003). On the other hand, the need to improve firm performance and
protect market share provide management with more effective bargaining tools while
reduced political involvement occasioned by privatisation undermines the ability of
unions to use their status as a political interest group to oppose reform (Pendleton, 1999).
Similar to changes in conditions of employment, perceived change in the level of
employees’ participation in firm decision-making can be expected to have a positive
relationship with employees’ perception on Privatisation initiatives. Several researchers
including Coch and French (1948) have emphasized the role of participation in decision
making for promoting employees’ acceptance of change.
2.4 Employees’ Perceived Change in Management-Union Collaboration/
Relationship on Privatisation
The rigid governance structures that exist in many public sector firms can also be
reflected in the firm’s industrial relations structures, which is often characterised by
centralised bargaining and elaborate procedures (Pendleton, 1997). As management seeks
to introduce reforms and overcome union opposition, privatisation can be expected to
result in the decentralisation of bargaining structures and the imposition of more flexible
procedures. According to Arrowsmith (2003), privatisation affects the ability of trade
unions to act as an effective voice of employees’ opinion. Pendleton (1999) also observed
that the need to improve a firm’s performance provide management with more effective
19
However, in many cases of privatisation, research shows that contrary to
expectations, existing bargaining structures are often maintained following privatisation
(Pendleton, 1999) with trade unions and management adopting a more pragmatic
approach. The management often identify trade union cooperation as a means of securing
employee acceptance for reform while Unions recognise the need to engage with
management to influence the outcome of reforms for the benefit of their members.
Since effective management-union collaboration is an important mechanism for
determining employee welfare, it can be expected that the employees’ perceptions of
post-privatisation management-union collaboration will be positively associated with
their response and commitment to the privatisation initiatives.
2.5 Employees’ Demographic Characteristics and their Perceptions on Privatisation
In a study of the employees attitudes towards privatisation conducted in Kuwait,
Madzikanda and Njoku (2008) found that Managers were less worried about job security
compared to low-level employees (at 73% vs. 81%). Non-Kuwaitis were found to be the
most concerned group of employees about possible job losses with privatisation (at 85%)
compared to Kuwaitis (at 74%), meaning that privatisation may come with a change in
workforce composition based on Nationality or a form of racial/tribal discrimination. On
the other hand, Madzikanda and Njoku (2008) found that female employees preferred
more secure working environments such as in the government sector much more than
their male counterparts. Consequently, employees’ personal characteristics will be
positively association with their perceptions.
bargaining tools while reduced political involvement occasioned by privatisation
undermines the ability of unions to use their status as a political interest group.
20
According to McCarthy, Reeves and Turner (2006), creating employee
shareholders can be expected to align the objectives of employees and management,
thereby facilitating greater employee understanding and acceptability in relation to
changes in conditions of employment brought about by privatisation. It therefore follows
that where employees receive shares free of charge or at a discounted price, the shares
can be viewed as a form of financial compensation in light of reforms attributed to
privatisation and this may also provide an opportunity to the employees and their
representatives to oppose adverse changes in conditions of employment. According to
Reeves (2006), providing employees and their representatives with ownership rights,
including voting rights and board-level representation may place management under
pressure to refrain from introducing measures that may have a negative impact on the
employee welfare. It therefore follows that if this strategy succeeds in opposing adverse
reforms, employees are enabled to identify with managerial objectives, or they are
provided with sufficient financial compensation to an extent that negative employee
perception and reduction commitment to privatisation is significantly reduced. Share-
ownership can therefore be seen as a means of creating great employee participation in
firm decision-making.
Much of the existing literature on employee share-ownership focuses on the
instrumental satisfaction model, which emphasises the importance of share-ownership
being accompanied by employees experiencing a genuine sense of ownership and control
(Klein, 1987; Pendleton, 1998). It thus follows that where share ownership is
2.6 Strategies for enhanced Positive Employees’ Perceptions on Privatisation of
State Owned Enterprises
21
representative in nature, increased levels of employee participation can be achieved
through the use of employee ownership rights (i.e. right to vote and appoint directors), or
by providing trade unions with a new role within the firm as the representatives of not
only employees but shareholders (McCarthy et al., 2006). As a result, employee share
ownership can be expected to counterbalance the loss of union bargaining strength
associated with privatisation and to provide employees with a greater sense of
participation in firm decision-making particularly at the firm-level.
Along with establishing such collaborative structures, providing employees with a
financial stake in the firm can also create a common ground upon which management and
unions can engage with one another (McCarthy et al., 2006) given that a good strategy
that wins labour support for privatization and creates a social safety for laid off workers
might be necessary for successful implementation of privatization (Cam, 1999).
2.7 Theoretical Framework
The section presents theoretical knowledge that seeks to explain the rationale
behind the employees’ varied perceptions/ attitudes and their associated implications on
the privatisation process implementation. This study is anchored on two theories, namely;
(i) Theory of Bounded Rationality propounded by Simon A. Herbert in 1972, (ii)
Vithessonthi’s Perception Based Model (2005).
2.7.1 The Theory of Bounded Rationality
The Theory of Bounded Rationality was propounded by Simon A. Herbert in 1972.
Bounded rationality (BR) is a concept that suggests that decision-makers are limited by
their values, unconscious reflexes, skills, habits, less than complete information and
knowledge (Griffin, 2005). According this theory, the rationality of individuals in
22
decision-making is thus limited by the information they have, the cognitive limitation of
their minds, and the finite amount of time they have to make a decision. In other words,
bounded rationality is that, because decision-makers lack the ability and resources to
arrive at the optimal solution, they instead apply their rationality only after having greatly
simplified the choices available. The theory suggests that although people try to be
rational decision makers, their rationality has limits. The theory thus provides for
decision making under a state of uncertainty where the decision maker does not know all
the alternatives, the risk associated with each alternative, or the likely consequences of
each alternative. Intuition, judgement, and experience play a major role in the decision
making process under conditions of uncertainty (Griffin, 2005). In addition, several
researchers have emphasized the existence of intuitive and irrational decision-making
(Isenberg, 1986; Fiske, 1992). That is, decision-making processes sometimes involve
experience-based mental routines, creating quick decisions without rational thought.
In the same vain, conditions that inform the employees’ perceptions and attitudes
on the impending privatisation of Muhoroni Sugar Company is that of great uncertainty
where employees do not know all the benefits and risks associated with the process and
the consequences of their actions for or against the privatisation process. This thus shall
explain the expected varied employees’ perceptions and attitudes on the programmed
privatisation of Muhoroni Sugar Company Limited and the associated implications of
such perceptions on the implementation process.
2.7.2 Vithessonthi’s Perception Based View Model
In contrast to the rational decision-making approach commonly used in the
mainstream research in management science, an alternative approach labelled as ‘a
23
perception-based view’ in decision-making propounded by Chaipom Vithessonthi in
2005 focuses on the use of perception, attitude or emotion for the purpose of selecting a
sensible alternative in pursuit of one’s goals. The main purpose of the perception-based
view (PBV) of the employee in this study is to explain the variations in decisions and/or
behaviour among employees in the same context. That is, it attempts to answer two
primary questions: (1) why do individuals in the similar setting and facing the same
object have differing decisions; and (2) why do individuals make decisions that might
seem irrational, and be contradictory to those predicted by rational choice theories?
Perceptions are multi-dimensional and have behavioural implications for humans’
decision-making. What, then, are the implications of perceptions on decisions and
behaviours? The central idea here is that a person may obtain a different perception of a
stimulus than others do, and each reacts to this stimulus according to his or her
interpretation process and is thereby motivated to make a decision that is different to one
another. The PBV perspective deals with how perceptions, attitudes, and emotions are
used by individuals to solve a problem or to make a decision. The review of the literature
on employees’ reactions to various organizational decisions (e.g., layoff, turnaround
strategy, and employee compensation plan) has identified several perception variables
that are expected to exert an influence either on their resistance to change or support for
change.
Empirical research has shown that in organizational settings, certain perceptions
such as the perception of uncertainty are associated with people’s behaviours. An
empirical study by Ashford (1989), for example, has shown evidence for a positive
relationship between perceived job insecurity and intention to quit. Another empirical
24
study by Fasolo and Davis-LeMastro (1990) has demonstrated that employees’ perceived
organizational support or lack of it is related to various attitudes and behaviours.
Accordingly, using the employee as the unit of analysis, one can explore perception or
attitude as a predictor of employees’ reaction to change (Privatisation in this case) based
on the observation that the relationships between perceptions and reactions to change are
more direct (Vithessonthi, 2005).
2.8 Conceptual Framework
Conceptual framework is an hypothesized model identifying the concepts under
investigation and their relationships (Mugenda & Mugenda, 2003). It establishes the
significance of proposed relationships between the variables of investigation. Based on
the results of the initial literature review, a conceptual framework for this study, as
illustrated in Figure 2.1, was developed. The independent variables in this proposed study
are the employees’ perceptions/ attitudes on the impending privatisation of Muhoroni
Sugar Company whose components are; perceived change in employees’ conditions of
employment, perceived change in employees’ level of participation in decision making,
employees’ perceived change in management-union collaboration or relationship, and
individual employee characteristics & perception/attitude on privatisation. On the other
hand, the dependent variable is the employees’ support & successful privatisation of
Muhoroni Sugar Company.
Accordingly, negative employees’ perceptions/attitudes on the programmed
privatisation of the Company may adversely affect the process by delaying the
implementation, rendering the process in effective, or completely derailing the entire
privatisation process leading to abandonment.
25
2.9 Summary of Literature Review
The literature reviewed in this chapter covers key aspects of privatization that
relates to the employees’ perceptions and attitudes. Authors from global and regional
arena are referred to in discussing the perceived and actual relationships between
privatization and the work environment. From the literature review, it has been found that
employees’ perceptions and attitudes on privatization of Government owned Enterprises
may be influenced by perceived change in the work environment. These perceived
changes may include; perceived change in conditions of employment, perceived change
in the level of employees’ participation in decision-making, and perceived change in
management-union collaboration or relationships. From the reviewed literature, negative
perception is associated with resistance to change and adverse effects on the
implementation of privatization programs. Mitigation measures for enhanced positive
perceptions and attitudes are also reviewed. The Theory of Bounded Rationality and
Vithessonthi’s Perception Based View Model were used to anchor the study and a
conceptual framework of the variables of investigation presented as illustrated in figure
2. 1.
27
CHAPTER THREE
RESEARCH METHODOLOGY
3.1 Introduction
This chapter discusses the research design that was adopted in this study. It
describes the research target population, sample size, sampling procedures as well as data
collection methods and research instruments used in this study. Research procedures,
administration of research instruments and data analysis and presentation, instrument
validity and reliability test methods adopted in the study are presented. The chapter also
details the ethical considerations that were made during this study.
3.2 Research Design
Research design is the structure of investigation conceived to obtain answers to the
research questions (Cooper and Schindler, 2008). This study adopted descriptive survey
research design with both qualitative and quantitative approaches. Descriptive survey
design is a method of collecting information by interviewing or administering
questionnaires to a sample of individuals. This design not only offers descriptions and
explanations, but it also identifies and predicts relationships between the variables of the
study (Mugenda and Mugenda, 1996). According to Kothari (2003), the strategy maintains
a high level of confidentiality, convenience, faster data collection and it facilitates asking
of questions either personally in an interview or impersonally through a questionnaire
about things which cannot be observed easily. It is relatively inexpensive as it provides for
self-reported facts about respondents, their feelings, attitudes, opinions and habits (Kombo
and Tromp, 2007; Kothari, 2007) and also gives the researcher an opportunity to get
28
accurate view of respondents. Descriptive design also supports the collection and analysis
of both qualitative and quantitative data required for the study hence its suitability for this
research.
3.3 Target Population
Target population is the collection of elements that possess information sought for
by a researcher to support the study (Oso and Onen, 2005). The target population for this
study consisted of the entire Muhoroni Sugar Company’s regular workforce totaling to
714 employees made up of management and non-management (unionisable) staff spread
in eight Departments thus: General Administration 16 employees), Factory Department
(369 employees), Agriculture Department (89 employees), Finance Department (118
employees), Logistics Department (70 employees), Human Resources Department (46
employees), Sales & Marketing Department (2 employees), and Audit Department (4
employees).
3.4 Sampling Procedure and Sample Size
Sampling is selecting a number of individuals for a study in such a manner that the
selected individuals represent the larger population from which they were selected
(Mugenda and Mugenda, 2003). This section describes the sample size and sampling
procedure that was used in the study.
3.4.1 Sample Size
According to Fraenkel and Norman (1990) and Kathuri and Pals (1993), a
descriptive study would require a representative sample comprising of a minimum of 100
subjects. Consequently, from the sample size determination table by Krejcie and Morgan
29
(1970) (shown in appendix III), a target population of 714 employees gave a sample size
of 248 respondents drawn from the target population comprising of management and
non-management (unionisable) staff of Muhoroni Sugar Company Limited.
3.4.2 Sampling Procedure
A stratified random sampling approach was adopted for this study. Using
information from the Company’s employees’ database, employees were categorised into
eight Departments namely; General Administration, Factory Department, Agriculture
Department, Finance Department, Logistics Department, Human Resources Department,
Sales & Marketing Department, and Audit Department. A sample frame was then
constructed Department wise from which the desired samples were randomly drawn. The
sample size comprised of proportions drawn from each of the eight Departments thus:
General Administration (6 respondents), Factory Department (128 respondents),
Agriculture Department (31 respondents), Finance Department (41 respondents),
Logistics Department (24 respondents), Human Resources Department (16 respondents),
Sales & Marketing Department (1 respondent), and Audit Department (1 respondent).
Table 3.1 below shows the target population stratification by Departments and the
corresponding sample sizes for each stratum giving a total representative sample size of
248 respondents drawn from the 714 regular employees of Muhoroni Sugar Company
Limited.
30
Table 3.1:
Sample Stratification
Departments Departmental Population Samples Selected
Administration 16 6
Factory 369 128
Agriculture 89 31
Finance 118 41
Logistics 70 24
Human Resources 46 16
Sales & Marketing 2 1
Audit 4 1
TOTALS 714 248
3.5 Research Instruments
The literacy level among the employees was assumed to be average. The researcher
therefore adopted a self-administered questionnaire dived into three parts for data
collection. The researcher preferred the use of questionnaire because it is quick in data
collection, relatively in expensive and enhances confidentiality of the respondents. The
instalment had both open and closed ended questions for the generation of the required
data. The semi-structured questionnaire was used for data collection from the Company
employees. The use of one type of questionnaire allowed for credible comparison of
31
information sought from both management and non-management staff. The first section
of the questionnaire sought for personal data of the employees including gender,
education, position and work experience.
The second part of the questionnaire was concerned with the employees’
perceptions and attitudes with regard to: perceived change in conditions of employment,
perceived change in the level of employee participation in decision-making, perceived
change in management-union collaboration or relationships and strategies for enhancing
positive employee perception and attitude on the privatization of Muhoroni Sugar
Company. The third and final part of the questionnaire assessed the general employees’
views on the programmed privatization of Muhoroni Sugar Company.
3.5.1 Pilot Testing of the Instrument
Pilot testing of the research instrument was conducted at the neighboring Chemelil
Sugar Company. Chemelil Sugar was found to be ideal for pilot testing of the instrument
because it is also targeted for privatization alongside Muhoroni Sugar Company.
Permission was sought from the Management of Chemelil Sugar Company for purposes
of pilot testing. The pilot testing identified grey areas in the design, instrumentation and
data collection method for correction. Internal checking was done on the returned
questionnaires to establish whether the questions were understood by both the
respondents and the researcher in a common manner. This was important in the research
process because it assisted the researcher to identify and correct vague questions and
unclear instructions. It also assisted the researcher to capture important comments and
suggestions from participants which enabled the researcher to improve on the
effectiveness of the instrument.
32
3.5.2 Validity of the Research Instrument
A research instrument is valid if it actually measures what it is supposed to
measure (Mugenda and Mugenda, 2003) and when the data collected through it
accurately represents the respondents’ opinions (Amin, 2005). Content validity of a
measuring instrument is the extent to which it provides adequate coverage of the
investigative questions guiding the study (Mugenda, 2008). The following approaches
were used to validate the research instrument in this study: In the study, content validity
was determined by consulting with the researcher’s supervisors within the university. The
supervisors reviewed the instruments, advised on the clarity of the questions and their
relevance, recommended for improvements and verified whether the instrument was able
to address the objectives of the study. The questions and language used was
appropriately reviewed and the instrument adjusted accordingly for enhanced validity of
information obtained from respondents. The validity of the instruments was also
enhanced by basing its structure on the objectives of the study and by conducting a pilot
study as explained above.
3.5.3 Reliability of the Research Instrument
A reliable instrument is that which yields consistent results after repeated
measurements (Cooper and Schindler, 2008). The reliability of the instrument used in the
study was determined using the split-half method. After administering the questionnaires,
a correlation co-efficient was determined by the split-half method using the r-function of
Spearman Brown Prophesy formula to establish the relationship between the two set of
responses. To achieve this, responses from the chosen participants were divided into two
halves. One half contained item responses using odd serial numbers while the other half
33
contained item responses using even serial numbers. A correlation co-efficient between
them was then calculated using the Spearman Brown Prophecy formula shown below.
The coefficients gave the degree to which the two halves gave the same results hence
internal consistency and reliability.
Where;
Reliability = 2x Corr. Between the even Half
1 + Corr. Between the odd Half
R = 2re/(l+r0)
R is the coefficient of reliability, re is the correlation in the even half, and ro is the
correlation in the odd half. A value of R was obtained to be 0.72 denoting high reliability.
3.6 Data Collection Procedures
The Research proposal was presented and defended before the University
examination panel. Upon approval of the proposal, the researcher sought for a letter of
introduction from the University of Nairobi and a permit from the National Council of
Science and Technology as pre-requisites for data collection. The researcher then used
both the permit and the introductory letter from the University to further seek for
permission from the management of Muhoroni Sugar Company Limited to allow the
researcher conduct the study in the facility. Once all permissions were granted, the
researcher visited the study area and made appointments with MUSCO management. The
respondents were visited and the instrument administered to them.
34
3.7 Data Analysis Techniques
According to Kothari (2009), data analysis involves closely related operations
which are performed to summarize collected data while organizing them in a manner that
they answer research questions. It involves organizing the data, breaking the data into
categories and units and then searching for trends and patterns before deciding to report.
The quantitative and qualitative data obtained were coded and clustered for subsequent
statistical analysis. The researcher used the data collected to establish patterns, trends and
relationship of the variables in the research study. Data was analyzed using descriptive
statistics such as frequencies and percentage counts and presented in tabular forms.
Microsoft Excel (Ms-Excel) and Statistical Package for Social Sciences (SPSS) assisted
in analyzing quantitative data. The number of respondents who participated in every
option was recorded in one column as frequencies and corresponding percentages
calculated and recorded in another column. The strength of percentages was then used to
indicate preferred responses in each option. On the other hand, qualitative data was
transcribed, organized into various immerging themes of the study and reported
narratively.
3.8 Ethical Considerations
Information obtained from other sources or from authors to support the relevance
of this research was acknowledged in the form of references and in-text citations. The
researcher provided adequate and clear explanation on the purpose of the study to each
respondent. The researcher also sought for the respondent’s permission to participate in
the study. All the participants’ were assured of total confidentiality and that the
information provided was for academic purposes only.
university or M4IR06,<ikvyu um'fisr
35 & Q i 9 7VM FiQBl
CHAPTER FOUR
DATA ANALYSIS, PRESENTATION, INTERPRETATION AND DISCUSSION
4.1 Introduction
This chapter covers analysis, presentation and interpretation of data collected
during the study. The research findings are presented, interpreted and discussed
thematically based on the objectives of the study. The thematic areas covered include:
Questionnaire return rate; Demographic Characteristics of Respondents; Employees’
Perceptions and Attitudes on Privatisation; and General employees’ views on the planned
Privatisation of Muhoroni Sugar Company.
4.2 Questionnaire Return Rate
In this study, the research instrument was administered to 248 respondents
randomly drawn from the 714 regular employees of Muhoroni Sugar Company Limited.
Although the researcher targeted responses from all the 248 respondents to whom the
instrument were administered, 210 returned duly completed questionnaires giving an
overall questionnaire return rate of 84.68%.
Poor response rates reduce precision in research, and are a potential source of bias
which lessens the confidence with which the findings of the study can be accepted and
generalized. According to Mugenda and Mugenda (2003), a response rate of 50% is
adequate for analysis and reporting, while a response rate o f 60% is good, and that o f
70% and above is very good. It follows therefore that a response rate of 84.68% achieved
in this study was sufficient for analysis and reporting. Table 4.1 gives a summary of the
questionnaire return rate obtained in the study .
36
Table 4.1
Questionnaire Return Rate
Departments No. Distributed No. Returned Return Rate (%)
Administration 6 5 83.33Factory 128 109 85.15Agriculture 31 26 83.87Finance 41 35 85.36Logistics 24 . 20 83.33Human Resources 16 13 81.25Sales & Marketing 1 1 100Audit 1 1 100
TOTAL 248 210 84.68
The high questionnaire return rate achieved in this study was attributed to the
respondents’ cooperation, adequate time allowed for the completion of the questionnaires
and the consistent follow-ups made by the researcher and his research assistants.
4.3 Demographic Characteristics of Respondents
The respondents in the study were employees of Muhoroni Sugar Company
Limited comprising of Management and Non-Management (Unionisable) staff. The
researcher sought to establish the respondents’ distribution by sex; age; years of work
experience; level of education; and job title/category to enable the researcher demonstrate
the diversity of the respondents involved in the survey, justify the basis for divergent
opinions and provide a basis of analysis for the influence of such characteristics on the
responses obtained in the study. Respondents were therefore asked to provide the
necessary demographic data the results of which were presented and discussed in the
following subsequent sub-themes:
37
The researcher found it important to understand gender and job category
distribution of the respondents to provide a basis of analysis for the influence of
demographic characteristics on employees’ perceptions and attitudes on the planned
privatisation of Muhoroni Sugar Company Ltd.
The respondents were therefore asked to provide the necessary demographic data
and the results obtained summarized as shown in table 4.2.
Table 4.2
Distribution o f Respondents by Gender & Job Title/Category
4.3.1 Distribution of Respondents by Gender & Job Title/Category
Job Title/Category
Respondents’ Management Union Total
Gender F % F % f %
Male 40 19.50 137 65.24 177 84.29
Female 23 10.95 10 4.76 33 15.71
Total 63 30.00 147 70.00 210 100.00
Out of the 210 respondents who participated in the study, 177(84.29%) were males
and 33(15.71%) were females. On the other hand, 63(30%) of the 210 respondents were
in management whereas 147(70%) were unionisable staff.
It was thus established that the Company workforce is dominated by male
employees who accounted for 84.29% of the respondents. On the other hand, 23(69.70%)
of the female respondents held managerial positions with only 10(30.30%) being in the
union. These findings provided a basis of analysis for the influence of respondents’ job
38
4.3.2 Distribution of Respondents by Age Bracket
The researcher found it important to understand age distribution of the respondents
to provide a basis of analysis for the influence of demographic characteristics on
employees’ perceptions and attitudes on the planned privatisation of Muhoroni Sugar
Company Ltd. The respondents were asked to state their age brackets and the results
obtained summarised as presented in table 4.3.
Table 4.3
category on employees’ perceptions on the planned privatisation of the Company
discussed under clause 4.4.4 of this report.
Distribution o f Respondents by Age bracket
Age bracket (Years)Frequency (f) Percentage (%)
18-40 years 77 36.67
41-55 years 112 53.33
Over 55 years 21 10.00
Total 210 100.00
Of the 210 respondents who took part in the study, 112 (53.33%) were in the age
bracket of 41-55 years, 77(36.67%) were in the age brackets 18-40 years with those over
55 years constituting 10% of the respondents. This implies that over 63.33% of the
respondents who participated in the study were aged over 40 years. These findings
provided a basis of analysis for the influence of respondents’ age on employees’
perceptions on the planned privatisation of the Company discussed under clause 4.4.4 of
this report.
39
The researcher also found it necessary to understand education level distribution of
the respondents to provide a basis of analysis for the influence of demographic
characteristics on employee’s perceptions and attitudes. Respondents were asked to state
their highest academic qualifications and the results obtained presented in table 4.4.
Table 4.4:
4.3.3 Distribution of Respondents by Highest Level of Education
Distribution o f Respondents by Highest Level o f Education
Highest level of education Frequency (f) Percentage (%)
O level 31 14.76
A level 4 1.90
Certificate 85 40.48
Diploma 67 31.90
First degree 23 10.95
Total 210 100.00
On the basis of academic qualifications, out of the 210 respondents who
participated in the study, 85(40.48%) had certificate level qualifications, 67(31.90%)
were diploma holders, 31(14.76%) had ‘O’ level qualifications, 23(10.95) had first
degrees and only 4(1.9%) had ‘A’ level qualifications.
This shows that all the respondents who took part in the study were sufficiently
literate with the majority holding a minimum of certificate level qualifications. These
findings provided a basis of analysis for the influence of respondents’ level of education
40
4.3.4 Distribution of Respondents by Work Experience
Again, the restarcher found it necessary to understand work experience distribution
of the respondents t9 provide a basis of analysis for the influence of demographic
characteristics on employee's perceptions and attitudes. Respondents were asked to state
their years of work sperience the results of which were presented in tables 4.5.
on employees’ percstions on the planned privatisation of the Company discussed under
clause 4.4.4 of this nport.
Table 4.5:
Distribution o f respndents by years o f work experience in Muhoroni Sugar Company
Experience in Muloroni
Sugar Company Frequency (f) Percentage (%)
4 years and below 35 16.67
5 -10 years 108 51.43
11-20 years 42 20.00
Over 20 years 25 11.90
Total 210 100.00
Out of the 2II respondents who took part in the study, 67(31.90%) had worked for
Muhoroni Sugar Company for at least 11 years, another 108 (51.43%) had worked for the
Company for between 5 - 1 0 years. Only 35 (16.67%) of the respondents had worked for
the Company for 4 years and below.
These findings show that majority of the respondents who took part in the study
had sufficient infomation and knowledge about Muhoroni Sugar Company in particular
41
and on the Sugar industry in general which contributed to the accuracy of responses
obtained during the study. This validated and confirmed the reliability of the responses
obtained in the study given that majority of the respondents were seasoned employees
with sufficient practical work experience. The findings further provided a basis of
analysis for the influence of respondents’ work experience on employees’ perceptions on
the planned privatisation of the Company discussed under clause 4.4.4 of this report.
4.4 Employees’ Perceptions and Attitudes on Privatisation
The importance of employees’ opinions stems from the fact that they are
responsible for undertaking much work in the privatised Organisation. It therefore
follows that ensuring that employees’ hold favourable attitudes towards privatisation is
essential to the success of any privatisation programme.
Empirical research has shown that in organizational settings, perceptions such as
the perception of uncertainty are associated with people’s behaviours and that employees’
perceived organizational support or lack of it is related to various attitudes and
behaviours (Fasolo and Davis-LeMastro, 1990).
Accordingly, using the employee as the unit of analysis, one can explore perception
or attitude as a predictor of employees’ reaction to change (i.e. privatisation of Muhoroni
Sugar Company in this case) based on the observation that the relationships between
perceptions and reactions to change are more direct (Vithessonthi, 2005).
42
4.4.1 Employees’ Perceived Change in Conditions of Employment on
Privatisation of Muhoroni Sugar Company Limited.
Circumstances that inform employees’ perceptions and attitudes on the planned
privatisation of Muhoroni Sugar Company is that of uncertainty where employees do not
know all the benefits and risks associated with the process and consequences of their
actions for or against the privatisation process. Generally put, concerns on job security,
workload, remuneration, career progression, hours worked, and incentives among other
work related conditions may influence the perceptions/attitudes of workers on
privatisation negatively.
The researcher sought to establish the employees’ perceived change in conditions
of employment upon privatisation of Muhoroni Sugar Company to provide the basis of
analysis for employees’ perceptions on the planned privatisation of the Company. The
respondents were therefore asked to express their opinions on the expected change in
their employment system upon privatisation of the Company guided by arrange of
indicators constituting conditions of employment. The research findings were
summarized and tabulated as shown in table 4.6.
43
Table 4.6:
Responses on Perceived Change in Conditions o f Employment
Conditions of Employment
Job Title/ Category
Shall Increase
f %
Remain Unchanged f %
Shall Decrease f %
Security of employment Management 0 0.0 3 1.43 60 28.57Union 0 0.0 0 0.0 147 70.00Total 0 0.0 3 1.43 207 98.57
Work Load and Pressure Management 51 24.29 12 5.71 0 0.0Union 122 58.10 25 11.90 0 0.0Total 173 82.39 37 17.61 0 0.0
Hours Worked per week Management 25 11.90 32 15.24 6 2.86Union 56 26.67 79 37.62 12 5.71Total 81 38.57 111 52.86 18 8.57
Basic Pay/ Remuneration Management 33 15.71 30 14.29 0 0.00Union 20 9.52 62 29.52 65 30.95Total 53 25.23 92 43.81 65 30.95
Progression (Recruitment Management 0 0.0 2 0.95 61 29.05& Promotion) Union 0 0.0 8 3.81 139 66.19
Total 0 0.0 10 4.76 200 95.24
Availability of Overtime Management 0 0.0 4 1.90 59 28.10Union 0 0.0 4 1.90 143 68.10Total 0 0.0 8 3.80 202 96.20
Level of teamwork Management 4 1.90 21 10.00 38 18.10Union 2 0.95 13 6.19 132 62.86Total 6 2.85 34 16.19 170 80.96
Level of Training to Management 2 0.95 27 12.86 34 16.19employees Union 0 0.0 48 22.86 99 47.14
Total 2 0.95 75 35.72 133 63.33
Incentives & other benefits Management 4 1.90 4 1.90 55 26.20Union 3 1.43 4 1.90 140 66.67Total 7 3.33 8 3.80 195 92.87
Mean Score 36 17.04 42 20.00 132 62.96
44
Out of the 210 respondents who participated in the study, 207(98.57%) projected a
decrease in job security. The concern that privatisation could lead to job loss was
therefore prominent among the respondents. This was statistically significant in
demonstrating a negative perception and attitude held by the employees on the planned
privatisation of Muhoroni Sugar Company. Majority of respondents anticipated job losses
upon privatisation of the Company implying that most employees hold a negative
perception of the public sector reform policy on the account of job security. This is in line
with the findings of Nellis et al. (2004) that privatization in Latin America led to the loss
of several jobs; in Argentina, privatization between 1987 and 1997 led to the loss of
150,000 jobs ; in Mexico privatization of public enterprises was followed by the
dismissal of 50% of the workforce; in Brazil, the privatization of railways led to a
reduction of more than 90,000 jobs, and in Nicaragua, privatization as part of a
government-led transition from a command-economy to a market economy led to the
dismissal of 15% of the labour force.
On the other hand, 173(82.39%) of the 210 respondents who participated in the
study anticipated an increased workload, 200(95.24%) expected a decline in recruitment
and career progression, 170(80.96%) projected a decline in teamwork, while
202(96.20%) expected a reduction in overtime earnings with 195(92.87%) projecting a
reduction in incentives and other benefits to the employees upon privatisation of the
Company. These findings imply that majority of the employees anticipate unfavourable
changes in the levels of workload, recruitment, career progression and teamwork upon
privatisation of the Company which also informs a negative perception and attitude held
by workers on the planned privatisation initiative. This concurs with the views of Wood
45
(2004) that resulting changes in the conditions of employment such as increased
workload & pressure, increased hours worked, reduced job security and employee
benefits can have a direct and often negative impact on how employees perceive changes
in their conditions of employment. The findings are further supported by Madzikanda and
Njoku (2008) who observed that employees of the privatised SOEs are likely to come
under pressure to work harder for higher standards and that the perceived unfavourable
changes in their working conditions were likely to negatively influence their attitudes
towards privatisation.
In summary, an average of 132(62.96%) out of the 210 respondents who
participated in the study projected a deterioration in conditions of employment upon
privatisation of the Company, 42(20.00%) expected no change, while only 36(17.04)
expected an improvement in their conditions of employment. These findings inform an
overall negative perception and attitude held by the majority of the employees on the
planned privatisation of Muhoroni Sugar Company on account of anticipated
unfavourable changes in their conditions of employment. This concurs with the research
findings from a study conducted by Madzikanda and Njoku (2008) on the employees’
attitudes towards the privatisation of Kuwait’s state owned enterprises where it was
established that employees’ attitudes towards privatization were overwhelmingly
negative. These findings are further supported by the views of Wood (2004) who
observed that changes in conditions of employment, especially those that impact on an
employee’s immediate work environment (e.g. pay and hours worked), can have a
significant impact on employees’ commitment and attitudes towards privatisation.
46
It therefore follows that, since perceptions concerning organizational change
processes are significantly predictive of employees’ reactions to change (Vithessonthi,
2005), the negative employees’ perception established in this study would be associated
with possible resistance by employees of Muhoroni Sugar Company to the planned
privatisation of the state corporation. The employees are likely to resist the privatisation
implementation process since they perceive the public sector reform policy as having the
potential of being injurious to their conditions of employment. This concurs with the
observations made by Nellis et al. (2004) that opposition to privatisation arising from
negative perception turned violent in Bolivia leading to the cancellation of concession
and in Peru where the sale was abandoned. Coyle-Shapiro and Kessler (2000) also
observed that where employees feel management have allowed conditions to deteriorate
as a result of privatisation, they can be expected to reciprocate through resistance,
reduced commitment and poor performance thus defeating the purpose of the entire
process.
4.4.2 Employees’ Perceived Change in the level of Participation in decision
making on Privatisation of Muhoroni Sugar Company.
Similar to changes in conditions of employment, perceived change in the level of
employees’ participation in a firm’s decision-making can be expected to have a positive
relationship with employees’ perception on privatisation initiatives. Several researchers
including Coch and French (1948) have emphasized the role of participation in decision
making for promoting employees’ acceptance of change.
The study sought to establish the perceived change in the level of employee
participation in decision making on privatisation of Muhoroni Sugar Company so as to
47
provide the basis of analysis for employees’ perceptions on the planned privatisation of
the Company.
To achieve this, respondents were asked to express their opinions on the expected
decision-making involvement level changes upon privatisation of the company, covering
both operational and strategic organisational decision-making issues. The results obtained
were respectively discussed under the following sub-themes:
4.4.2.1 Employees’ Perceived Change in the level of Participation in
Operational Decision-Making Issues.
The study sought to establish the perceived change in the level of employee
participation in operational decision making upon privatisation of Muhoroni Sugar
Company so at provide a basis of analysis for employees’ perceptions on the planned
privatisation of the Company. To realize this, respondents were asked to express their
opinions on the expected operational decision-making involvement level changes upon
privatisation of the Company. The results obtained were as presented in tables 4.7.
48
Table 4.7
Responses on employees' perceived change in the levels o f involvement in decision
making (operational issues)
Operational decision making issues
Job Title/ Category
Shall Increase f %
Remain Unchanged
f %
ShallDecrease f %
Training requirements Management 0 0.0 2 0.95 61 29.05Union 0 0.0 12 5.72 135 64.29
Total 0 0.0 14 6.67 196 9333
Pay and Benefits Management 2 0.95 8 3.81 53 25.24Union 0 0.0 10 4.76 137 65.24
Total 2 0.95 18 8.57 190 90.48
Hours Worked Management 4 1.90 6 2.86 53 25.24Union 0 0.0 8 3.81 139 66.19
Total 4 1.90 14 6.67 192 91.43
Manner in which assigned Management 2 0.95 4 1.91 57 27.14tasks are completed. Union 0 0.0 21 10.0 126 60.00
Total 2 0.95 25 11.91 183 87.14
Mean Score 2 0.95 18 8.57 190 90.48
Of the 210 respondents who took part in the study, 190(90.48) perceived a decrease
in the level of employee involvement in decision making on operational issues within the
company upon privatisation. On the other hand, 18(8.57%) held believed that status quo
shall be maintained with only 2(0.95) of the respondents projecting an improvement in
the level of employee involvement in operational decision making once the Company is
privatised.
These findings imply that majority of Muhoroni Sugar Company employees
perceive a negative change in the level of employee involvement in the firm’s operational
49
decision making issues upon privatisation of the firm. This concurs with the views
expressed by O'Connell (1993), that privatisation often involves a reduction in the
number of managerial layers and the establishment of market-based business units with
clearly defined and quantifiable performance targets that provide lower level managers
with an incentive to more closely supervise and control employee decisions thus reducing
employees’ sense of participation in decision-making at the workplace.
Given that majority of Muhoroni Sugar Company employees perceive a negative
change in the level of employee involvement in the firm’s operational decision making
issues upon privatisation of the firm, it follows therefore that the employees are likely to
resist the Organisation’s privatisation implementation process. The possible resistance by
the employees may therefore slow down or completely derail the actualization of the
public sector reform policy in the Company thus causing the Organisation to lose out on
the anticipated benefits of privatisation.
4.4.2.2 Employees’ Perceived Change in the level of Participation in
Strategic/Departmental Decision-Making Issues.
The study also sought to establish the perceived change in the level of employee
participation in strategic/departmental decision making upon privatisation of Muhoroni
Sugar Company to provide a basis of analysis for employees’ perceptions on the planned
privatisation of the Company. The respondents were therefore asked to express their
opinions on the expected strategic/departmental decision-making involvement level
changes upon privatisation of the Company. The results obtained were summarized as
presented in tables 4.8.
50
Table 4.8
Responses on employee's perceived change in the levels o f involvement in decision
making (on Strategic/Departmental Issues)
Strategic decision making Issues
Employeecategory
Shall Increase F %
RemainUnchangedF %
ShallDecrease
f %Hiring of Management 0 0.0 4 1.90 59 28.10employees Union 2 0.95 12 5.71 133 63.33
i oiai 2 0.95 16 7.62 192 91.43
Dismissal of Management 0 0.0 2 0.95 61 29.05employees Union
Total0 0.0 15 7.14 132 62.850 0.0 17 8.10 193 91.90
Promotion of Management 0 0.0 4 1.91 59 28.10employees Union 2 0.95 15 7.14 130 61.90
Total 2 0.95 19 9.05 189 90.00
Transfer of Management 0 0.0 5 2.38 58 27.62employees Union 2 0.95 10 4.76 135 64.29
Total 2 0.95 15 7.14 193 91.91
Firm Budget and Management 0 0.0 4 1.90 59 28.10Finances Union 0 0.0 15 7.14 132 62.85
Total 0 0.0 19 9.05 191 90.95
Other strategic & Management 0 0.0 2 0.95 61 29.05departmental Union 0 0.0 12 5.71 135 64.29decisions
Total 0 0.0 14 6.67 196 93.33
Mean Score 1 0.50 17 7.94 192 91.56
51
On strategic/departmental decision making, 192(91.56%) of the 210 perceived a
decline in the level of employee involvement in strategic/departmental decision-making
issues upon privation of Muhoroni Sugar Company while 17(7.94%) of the respondents
projected that status quo shall be maintained with only 1(0.50%) respondent projecting an
improvement in the level of employee involvement in strategic/departmental decision
making on privatisation of the Company. On average 191(91.02%) respondents out of the
210 projected a decline in the level of employee involvement in both strategic and
operational decision-making issues upon privatisation of the Company.
These findings imply that majority of Muhoroni Sugar Company employees
perceive a negative change in the level of employee involvement in the firm’s
strategic/departmental decision making issues upon privatisation of the firm. This
concurs with the views expressed by O'Connell (1993), that privatisation often involves
the establishment of market-based business units with clearly defined and quantifiable
performance targets that provide lower level managers with an incentive to more closely
supervise and control employee decisions thus reducing employees’ sense of participation
in decision-making at the workplace. Pendleton (1999) also agrees that the need to
improve a firm’s performance provide management with more effective bargaining tools
while reduced political involvement occasioned by privatisation undermines the ability of
unions to use their status as a political interest group.
Given that majority of Muhoroni Sugar Company employees perceive a negative
change in the level of employees’ involvement in the firm’s strategic/departmental
decision making issues upon privatisation of the firm, it follows that the employees are
likely to resist the privatisation of the Company so as to protect their representation and
52
interests in the firm’s decision making structures. This argument is in line with the views
expressed by Vithessonthi (2005) that employees who perceive a low level of their
participation in an organization’s decision-making concerning organizational change tend
to react more negatively to change than those who perceive a high level of their
participation in decision-making and vice versa. He argues that perceived degree of
participation in decision-making tends to be associated with employees’ resistance
to change and support for change.
4.4.3 Employees’ Perceived Change in Management-Union Collaboration/
Relationships on Privatisation of Muhoroni Sugar Company.
Since effective management-union collaboration is an important mechanism for
determining employee welfare, it can be expected that employees’ perceptions of post
privatisation management-union collaboration/relationship will be positively associated
with their commitment and response to the privatisation initiatives.
The study therefore sought to explore the employees’ perceived change in
Management-Union collaboration/ relationships upon privatisation of Muhoroni Sugar
Company so as provide a basis of analysis for employees’ perceptions on the planned
privatisation of the Company.
To realize this, respondents were asked to express their opinions on the expected
changes guided by five Management-Union Collaboration Indicators. The findings were
summarized and presented in table 4.9.
53
Table 4.9
Responses on Perceived change in Management-Union Collaboration/Relationships
Management-Union Collaboration Issues
Job Title/ Category
Agreef %
Neitherf %
Disagreef %
Principals/Management will Management 0 0.0 4 1.90 59 28.10be more willing to cooperate with the employees Union in
Union0 0.0 10 4.76 137 65.24
resolving disputes or problems facing employees Total 0 0.0 14 6.67 196 93.33
Employees union will be Management20 9.52 2 0.95 41 19.52
more willing to cooperate with Principals
Union44 20.95 6 2.86 97 46.19
/Management on resolving disputes or problems facing employees Total 64 30.48 8 3.81 138 65.71
Management will see Management4 1.91 10 4.76 49 23.33
cooperation with employees Union as a vital tool in
Union2 0.95 35 16.67 110 52.39
creating successful & effective change in the Organisation Total 6 2.86 45 21.43 159 75.71
Union-Management Management 4 1.91 10 4.76 49 23.33relations will improve Union 2 0.95 33 15.71 112 53.33significantly
Total 6 2.86 43 20.47 161 76.67
U nion-Management Management 46 21.91 2 0.95 15 7.14relations will deteriorate Union 135 64.29 4 1.91 8 3.81significantly
Total 181 86.19 6 2.86 23 10.95
Mean Score 51 24.48 24 11.05 135 64.47
54
Of the 210 respondents, 181(86.19%) reported that Union-Management relations
will deteriorate significantly upon privatisation of Muhoroni Sugar Company. On the
other hand, 196 (93.33%) reported that Principals/Management will be less willing to
cooperate with the employees’ union in resolving disputes or problems facing employees
while 110(52.39%) felt that management shall not see cooperation with employees’ union
as a vital tool in creating successful & effective change in the Organisation.
These findings imply that majority of the employees perceive a decline in the status
of management-union collaboration/relationships once the Company is privatised hence a
negative perception. These findings are in line with the views of Arrowsmith (2003), that
privatisation affects the ability of trade unions to act as an effective voice of employees’
opinion. Pendleton (1999) also agrees that the need to improve a firm’s performance
provide management with more effective bargaining tools while reduced political
involvement occasioned by privatisation undermines the ability of unions to use their
status as a political interest group. However, these findings contradict the views
expressed by Arrowsmith (2003) who observed that management often identify trade
union cooperation as a means of securing employee acceptance for reform, and thus
avoiding industrial conflict while Unions recognise the need to engage effectively with
management in order to influence the outcome of reforms and minimise the adverse
consequences for their members.
Generally put, changes that affect employees’ union adversely are likely to attract
resistance from the members. Consequently, arising from the established negative
perception held by the employees on Management-Union collaboration upon
privatisation of the Company, the employees’ Union are likely to influence the workers to
55
resist or sabotage the Company’s Privatisation implementation process unless their
concerns are effectively addressed. This may adversely affect the Organisations recovery
strategy which is partly anchored on the success of the privatisation process.
4.4.4 Employees’ Demographic Characteristics and Perceptions on
Privatisation of Muhoroni Sugar Company Limited.
Studies have shown that people’s characteristics may have a bearing on the kind of
decisions they make when faced with certain situations or when in certain circumstances.
In this study, the researcher sought to examine the extent to which employees’
demographic characteristics influenced their perceptions on privatization of Muhoroni
Sugar Company on the basis of responses given by each respondent guided by arrange of
indicators across the variables of investigation.
The results obtained were summarized and discussed under the following sub
themes:
4.4.4.1 Response Distribution by Respondents’ Level of Education on
Conditions of Employment
The researcher found it important to understand response distribution by the
respondents’ level of education on the conditions of employment to provide a basis of
analysis for the influence of demographic characteristics on employees’ perceptions and
attitudes on the planned privatisation of Muhoroni Sugar Company Ltd.
The response distribution by respondents’ level of education on the perceived
change in conditions of employment upon privatisation of Muhoroni Sugar Company
were therefore summarized and tabulated as shown in table 4.10a.
56
Table 4.10a
Response distribution by respondents ’ Level o f Education on Conditions o f Employment
Conditions of Employment
EducationLevel
ShallIncrease
F %
RemainUnchanged
F %
ShallDecrease
F %Security of employment “O” level 0 0.0 0 0.0 31 100.00
A level 0 0.0 0 0.0 4 100.00Certificate 0 0.0 0 0.0 85 100.00Diploma 0 0.0 0 0.0 67 100.00First degree 0 0.0 3 13.04 20 86.96
Basic Pay/ Remuneration O level 4 12.90 8 25.81 19 61.29A level 2 50.00 0 0.0 2 50.00Certificate 13 15.29 42 49.41 30 35.29Diploma 14 20.90 39 58.21 14 20.90First degree 20 86.96 3 13.04 0 0.0
Progression (Recruitment O level 0 0.0 0 0.0 31 100.00& Promotion) A level 0 0.0 0 0.0 4 100.00
Certificate 0 0.0 0 0.0 85 100.00Diploma 0 0.0 0 0.0 67 100.00First degree 0 0.0 3 13.04 20 86.96
On conditions employment, 187(100%) of the respondents with lower than first
degree qualifications projected a decline in job security unlike those with first degree
qualifications where 3(13.4%) projected no change in job security. On the other hand,
20(86.96%) of the respondents with a minimum qualification of first degree projected an
increase in basic pay/ remuneration upon privatization of the Company against a paltry
33(24.77%) for those with lower qualifications. Again, 187(100%) of the respondents
with below first degree qualifications projected a decrease in career progression
compared to 20(86.96%) for those with first degree qualifications.
Based on these results, it is evident that respondent’s level of education influenced
their responses significantly since those with lower academic qualifications projected
57
more of reduced job security upon privatization of the Company compared to the
respondents with higher academic qualifications. On the other hand, respondents with
higher academic qualifications projected an increase in basic salary/remuneration on
privatization of the Company as opposed to those with lower qualifications who projected
a decrease.
It therefore follows that Muhoroni Sugar Company’s employees with higher
academic qualifications are more likely to embrace or support the privatization of the
Company as opposed to those with lower education levels. These findings concur with
those of Madzikanda and Njoku (2008) in a study of employees’ attitudes towards
privatisation conducted in Kuwait, where they established that workers who had higher
academic qualifications were less worried about their job security following privatisation
compared to those with lower academic qualifications.
4.4.4.2 Response Distribution by Respondents’ Job Tittle/Category on
Perceived Change in Conditions of Employment
The researcher found it important to understand response distribution by the
respondents’ job tittle on the perceived change in conditions of employment to provide a
basis of analysis for the influence of demographic characteristics on employees’
perceptions and attitudes on the planned privatisation of Muhoroni Sugar Company Ltd.
The response distribution by respondents’ job tittle/category on the perceived
change in conditions of employment upon privatisation of Muhoroni Sugar Company
were hence summarized and tabulated as shown in table 4.10b.
58
Table 4.10b
Response distribution by Respondent’s Job Tittle/ Category on Perceived Change in
Conditions o f Employment
Conditions of Employment
Job Title/ Category
Shall Increase
f %
Remain Unchanged F %
Shall Decrease f %
Security of employment Management 0 0.0 3 4.80 60 95.20Union 0 0.0 0 0.0 147 100.00
Total 0 0.0 3 1.43 207 98.57
Basic Pay/ Remuneration Management 33 52.38 30 47.62 0 0.00Union 20 13.61 62 42.18 65 44.21
Total 53 25.23 92 43.81 65 30.95
Progression (Recruitment Management 0 0.0 2 3.17 61 96.83& Promotion) Union 0 0.0 8 5.44 139 94.56
Total 0 0.0 10 4.76 200 95.24
On conditions of employment, 147(100%) of the unionisable respondents projected
a decrease in job security compared to those representing management at 60(95.20%). On
the other hand, 33(52.38%) of the respondents from management projected a salary
increase compared to a paltry 20(13.61%) of the unionisable respondents.
These findings imply that management employees of Muhoroni Sugar Company
are less worried about their job security on privatization of the Company as compared to
the unionisable staff. This is again in agreement with the findings of Madzikanda and
Njoku (2008) in a study of employees attitudes towards privatisation conducted in
Kuwait, where they found that Managers were less worried about their job security
following privatisation compared to low-level employees (at 73% against 81%).
59
4.4.4.3 Response Distribution by Respondents’ Job Tittle/Category,
Gender, Age, Level of Education and Working experience on
employee awareness
The researcher found it important to understand response distribution by the
respondents’ job tittle, gender, age, education and working experience on employee
awareness to provide a basis of analysis for the influence of demographic characteristics
on employees’ perceptions and attitudes on the planned privatisation of Muhoroni Sugar
Company Ltd.
The response distributions by respondents’ job tittle/category, gender, age, level of
education, and working experience on employees’ awareness of the planned privatisation
of Muhoroni Sugar Company were summarized and tabulated as shown in table 4.10c.
60
Table 4.10c
Response distribution by respondents’ Job Title/Category, Gender, Age, level o f
Education and Working experience on employee awareness
DemographicCharacteristics
YESf %
NOf %
Management 59 93.65 4 6.35Title/Category Union 130 88.44 17 11.56
Total 189 90.00 21 10.00
Gender Male 159 89.83 18 10.17Female 30 90.91 3 9.09Total 189 90.00 21 10.00
Age 18-40 60 77.92 17 22.084 1 -5 5 109 97.32 3 2.68Over 55 20 95.24 1 4.76Total 189 90.00 21 10.00
Education O level 22 70.97 9 29.03A level 2 50.00 2 50.00Certificate 75 88.24 10 11.76Diploma 67 100 0 0.0First degree 23 100 0 0.0Total 189 90.00 21 10.00
Experience 4 years & below 1 12.50 7 87.505-10 54 84.38 10 15.6211-20 95 96.94 3 3.06Over 20 39 97.50 1 2.50Total 189 90.00 21 10.00
On awareness, 59(93.65%) of respondents from the management confirmed that
they were aware of the planned privatisation of the company compared to 130(88.44%)
of the union. On the other hand, 90(100%) of the respondents with diploma and first
degree qualifications reported that they were aware of the planned privatisation of the
company compared to an average of 99(69.74%) for those with lower academic
qualifications. This could be attributed to the fact that management staffs majority of
61
whom possess higher academic qualifications have more access to corporate and general
information on the state and current affairs of the Kenyan Sugar Industry as compared to
the rest of the employees. This therefore means that Muhoroni Sugar Company
employees who are in management are more likely to support the planned Privatisation of
the Company as compared to those in the union majority of whom have lower academic
qualifications.
4.4.4.4 Response Distribution by Respondents’ Job Tittle/Category,
Gender, Level of Education, Age and Working experience on
adequacy of employee sensitization
The researcher also found it important to understand response distribution by the
respondents’ job tittle, gender, age, education and working experience on employee
sensitization to provide a basis of analysis for the influence of demographic
characteristics on employees’ perceptions and attitudes on the planned privatisation of
Muhoroni Sugar Company Ltd.
The response distributions by respondents’ job tittle/category, gender, age, level of
education, and working experience on employees’ sensitization on the planned
privatisation of Muhoroni Sugar Company were therefore summarized and tabulated as
shown in table 4.10d.
62
Table 4.10d
Response distribution by respondents ’ Job Title/Category, Gender, Level o f education,
Age and Working experience on employees' sensitization
Demographic
Characteristics
Y E S N O
r % f %Title/Category Management 34 53.97 29 46.03
Union 50 34.01 97 65.99Total 84 40.00 126 60.00
Gender Male 55 31.07 122 68.93Female 29 87.88 4 12.12Total 84 40.00 126 60.00
Age 1 8 - 4 0 17 22.08 60 77.324 1 - 5 5 50 44.64 62 55.36Over 55 17 80.95 4 19.05Total 84 40.00 126 60.00
Education level O level 5 16.13 26 83.87A level 0 0.0 4 100Certificate 16 18.82 69 81.18Diploma 40 59.70 27 40.30First degree 23 100 0 0.0Total 84 40 .00 126 60.00
Experience 4 years & below 0 0.0 8 1005 - 10 28 43.75 36 43.6711-20 38 38.78 60 61.22Over 20 18 45.00 22 55.00Total 84 40.00 126 60.00
From the findings shown in table 4.10d, 34(53.97%) of the management reported
adequate sensitization levels compared to 50(34.01%) of the unionisable staff. This could
be attributed to the fact that management have more access to corporate and general
information on the state and affairs of the Kenyan Sugar Industry as compared to the rest
of the employees. This again implies that the Muhoroni Sugar Company employees in
63
management are more likely to support the Privatisation of the Company as compared to
those in the union.
On the other hand, 29(87.88%) of the female respondents confirmed the adequacy
of sensitisation already done to the employees compared to a paltry 55(31.07%) of the
male respondents. This could be attributed to the fact that the majority of female
employees of Muhoroni Sugar Company are in management and are therefore having
more access to vital information on the current affairs in the Kenyan Sugar Industry. It
therefore implies that majority of the female employees are more likely to respond
favourably to the planned privatisation of the Company as compared to their male
counterparts.
On the basis of academic qualifications, those with first degree and diploma
qualifications confirmed the adequacy of sensitization so far conducted at 23(100%) and
40(59.70%) respectively compared to an average of only 21(17.48%) for those with
lower academic qualifications. This could be attributed to the fact that those employees
with higher academic qualifications are more exposed and have access to a wide range of
information on current affairs in the Kenyan Sugar industry. It therefore follows that
employees with higher academic qualifications are more likely to support the planned
privatisation of the Company as compared to those with lower academic qualifications.
4.4.4.5 Response Distribution by Respondents’ Job Tittle/Category and
Level of Education on the necessity of Privatisation
The researcher also found it necessary to understand response distribution by the
respondents’ job tittle/category and level of education on the necessity of privatisation to
provide a basis of analysis for the influence of demographic characteristics on
64
The response distribution by respondents’ job tittle/category and level of education
on the necessity of privatisation as a public sector reform policy for the Kenyan sugar
industry were summarized and tabulated as shown in table 4.1 Oe.
Table 4.10e
Response distribution by respondents ’ Job Title/ Category & Level o f Education on the necessity o f privatization as a public sector reform policy
employees’ perceptions and attitudes on the planned privatisation of Muhoroni Sugar
Company Ltd.
DemographicCharacteristics
fYES
% fNO
%Job Title/ Category Management 30 47.62 4 6.35
Union 42 28.57 8 5.44Total 72 34.29 12 5.71
Education level 0 level 0 0.0 10 32.26A level 0 0.0 2 50.00Certificate 20 23.53 0 0.0Diploma 30 44.78 0 0.0First degree 23 100 0 0.0Total 72 34.29 12 5.71
On the other hand, based on the findings shown in table 4.10e, out of the 63
respondents who represented management in the study, 30(47.62%) approved of the need
for privatisation of the Kenyan Sugar Industry against 42(28.57%) respondents from the
unionisable staff.
These findings again imply that job category and the respondent’s academic
qualifications significantly influenced their responses during the study. It is hence
apparent from the findings that the employees’ perceptions and attitudes on the planned
65
Overall findings on the influence of respondents’ demographic characteristics have
therefore shown that job category (Management/Unionisable) and academic
qualifications play a significant role in shaping the employees’ perceptions on
privatisation initiatives. Consequently, the Muhoroni Sugar Company employees in
management and those with higher academic qualifications are therefore more likely to
support the planned privatisation of Company as compared to those in the union majority
of whom have lower academic qualifications.
4.4.5 Measures for enhanced employees’ positive perceptions and attitudes
on privatisation of Muhoroni Sugar Company Limited.
Establishing collaborative structures and providing employees with a financial
stake in the privatized firm for example, can create a common ground upon which
management and unions engage with one another. Accordingly, a good strategy that wins
labour support for privatization and creates social safety for laid off workers might be
necessary for successful implementation of a privatization initiative (Cam, 1999). The
study sought to suggest suitable measures and strategies that can be used to address the
employees’ concerns for enhanced positive perceptions and attitudes on the planned
privatisation initiative.
Respondents were therefore asked by the researcher to express their opinions on
the suitability of arrange of suggested measures and to specify any other measure (s) that
they deemed suitable. The results that were obtained were summarised in table 4.11.
privatisation of Muhoroni Sugar Company are significantly influenced by their job
categories and level of academic qualifications.
66
Table 4.11:
Responses on Measures for enhanced employees ’ positive perceptions and attitudes on
privatization
Measures for Enhanced positive Job Title/ YES NOemployees perceptions and Categoryattitudes f % f %
Signing of employee retention or no Management 57 27.14 6 2.86lay-off agreements for a reasonable period of time to a lay the fear of job
Union 137 65.24 2 4.76
loss in the privatized Company. Total 194 92.38 16 7.62
Providing for significant Employee Management 57 27.14 6 2.86shareholding in the sale agreements Union 143 68.10 4 1.90of the Company. Total 200 95.24 10 4.76
Providing for effective employees Management 55 26.19 8 3.81Union representation in Key Management decision making
Union 138 65.71 9 4.29
organs of the privatized Company. Total 193 91.90 17 8.10
Providing for Merit-based staff Management 59 28.10 4 1.90recruitment, promotion & remuneration in the privatized
Union 139 66.19 8 3.81
Company. Total 198 94.29 12 5.71
Training and equipping employees who might lose jobs due to
Management 59 28.10 4 1.90
privatization with skills for self- employment, or re-employment into Union 147 100 0 0.0
some other public or private sectors. Total 206 98.10 4 1.90
Mean Score 198 94.38 12 5.62
Out of the 210 respondents, an average of 198 (94.38%) approved of suggested
measures and strategies for enhanced positive employee perceptions and attitudes.
Training and equipping employees for self or re-employment in some other sectors
67
received the highest approval of 206(98.10%) followed by the proposal to provide for
employee shareholding in the privatised Company 200(95.24%).
Providing for Merit-based staff recruitment, promotion & remuneration in the
privatized Company got an approval rate of 198(94.29%) while ssigning of employee
retention or no lay-off agreements for a reasonable period of time in the privatized
Company received an approval rate of 194(92.38%). On the other hand, providing for
effective employees’ union representation in Key Management decision making organs
of the privatized Company received an approval rate of 193(91.90%).
It implies therefore that privatisation as a public sector reform policy brings with it
far reaching implications to the employees of the privatised firm hence the need to come
up measures and strategies that would create a common ground upon which management
and employees’ unions engage with one another. Accordingly, a good strategy that wins
labour support for privatization and creates social safety for workers might be necessary
for successful implementation of a privatization initiative. This concurs with the views of
McCarthy, Reeves and Turner (2006), who observed that creating employee shareholders
can be expected to align the objectives of employees and management, thereby
facilitating greater employee understanding and acceptability in relation to changes in
conditions of employment brought about by privatisation.
68
The researcher sought to obtain general employees’ views on the planned
privatisation of Muhoroni Sugar Company since this could also provide a basis for
important research conclusions and recommendations. The research findings were
presented and discussed under the following themes:
4.5.1 Employees’ awareness and levels of sensitization on the planned
privatisation of Muhoroni Sugar Company.
In establishing the employees’ general views, the researcher first sought to obtain
employees’ opinions on the level of awareness and adequacy of employee-sensitization
done on the planned privatisation of Muhoroni Sugar Company Limited. The findings
obtained were summarised as shown in table 4.12a.
Table 4.12a
Responses on employees ’ awareness levels and adequacy o f employee sensitization done
on the planned privatization o f Muhoroni Sugar Company Limited
4.5 General employees’ views on the planned privatisation of Muhoroni Sugar
Company.
Statements Job Title/ YES NOCategory F % f %
Level of Employee awareness of Management 59 93.65 4 6.35the planned privatization of Muhoroni Sugar Company Limited.
Union130 88.44 17 11.56
Total 189 90.00 21 10.00Adequacy of employee sensitization done on the planned Management 34 53.97 29 46.03privatization of Muhoroni Sugar Company Limited. Union 50 34.01 97 65.99
Total 84 40.00 126 60.00
Mean 136 65.00 74 35.00
69
Out of the 210 respondents, 189(90%) reported that they were aware of the planned
privation of Muhoroni Sugar Company. However, 126 (60%) of the respondents reported
that inadequate employee-sensitization had been done on the planned privatisation of the
Company.
These findings imply that despite majority of the employees being aware of the
planned privation of Muhoroni Sugar Company, a good number are of the opinion that
the sensitization so far done to the employees on the planned privatisation of the
Company is inadequate. Consequently, employees may resist or reject the planned
privatisation of the Company for fear of the unknown mainly informed by lack of
adequate information on the benefits of privatisation as public sector reform policy.
4.5.2 Employees’ views on the relevance of privatisation as a public sector
reform policy for the Kenyan Sugar Industry.
Secondly, the researcher sought to establish whether the employees considered
privation as relevant for the Kenyan Sugar Industry also to provide a basis for important
research conclusions and recommendations. The results that were obtained were again
tabulated as shown in table 4.12b.
70
Table 4.12b
Responses on whether privation as a public sector reform policy is necessary for the
Kenyan Sugar Industry
Job Title/Category
f
YES%
NOf %
Management 30 47.62 4 6.35Union
42 28.57 8 5.44
Total 72 34.29 12 5.71
Of the 210 respondents, 72(34.29%) approved of the need for privatisation in the
Kenyan Sugar industry, 12(5.71%) disapproved of the need while 126(60.00%) remained
non-committal on the matter citing inadequate sensitization on the matter. Out of the 63
respondents who represented management in the study, 30(47.62%) approved of the need
for privatisation whereas for the unionisable staff, only 42(28.57%) respondents approved
of the need for privatisation of Muhoroni Sugar Company.
Based on these findings, majority of the respondents who disproved of the
necessity of privatisation for the Kenyan Sugar Industry were from the union. It therefore
follows that the unionisable staff are more likely to resist the planned privatisation of
Muhoroni Sugar Company as compared to those in management.
71
I
4.5.3 Employees* views on what they consider as the main reason for the
privatisation of Muhoroni Sugar Company
Finally, the researcher sought to establish from the employees’ what they
considered as the main reason behind the planned privation of Government owned Sugar
Companies and Muhoroni Sugar Company in particular. This was also found necessary
so as to provide a basis for important research conclusions and recommendations.
The respondents gave varied reasons for the privatisation of Muhoroni Sugar
Company. The results obtained were summarized as shown in table 4.12c.
Table 4.12c
Main Reasons for the privatization o f Muhoroni Sugar Company
Reason for the privatization of Job Title/ Frequency Percentage
Muhoroni Sugar Company Category f %
Reduce Government expenditure on ManagementUnion
38
4.765.44
SOEsTotal 11 5.24
Improve Performance of SOEs ManagementUnion
2620
41.2713.61
Total 46 21.91
Generate revenues from the Management 1 1.59Union 2 1.36
privatization programmeTotal 3 1.43
Fulfill IMF, WB and COMESA Management 0 0.0Union 12 8.16
conditionalityTotal 12 5.71
72
Out the 210 respondents, only 72(34.29%) gave reasons for the privation of the
company, 138(65.71%) gave no reasons with 126(60%) of them citing inadequate
sensitization on the public sector reform policy while 12(5.71%) of the respondents were
of the opinion that privatisation was not necessary for the Kenyan Sugar Industry.
The results demonstrate that only 46 (21.90%) of the respondents were informed
on the main reason for the planned privatisation of the Kenyan Sugar Industry. This
means that majority of the employees have insufficient information on the planned
privation of the Company and that their negative perceptions may largely be informed by
lack of vital knowledge on the valuable public sector reform policy.
Consequently, the employees of Muhoroni Sugar Company may reject or resist the
Company’s privatisation implementation process largely due to lack of adequate vital
information on the benefits of the reform policy both to them as workers and the
Organisation at large. This concurs with the views expressed by Vithessonthi (2005) that
perceptions concerning organizational change processes are significantly predictive of
employees’ reactions to change.
The anticipated resistance to the Company’s privatisation implementation process
based on these findings is therefore likely to adversely affect the Organisation’s recovery
strategy which is partly anchored on the success of the initiative.
73
CHAPTER FIVE
SUMMARY OF FINDINGS, CONCLUSIONS AND RECOMMENDATIONS
5.1 Introduction
This chapter summarizes the main findings of the study; the conclusions arising
from the findings and recommendations emanating from the research. The chapter also
covers the knowledge contributions of the study and suggestions for further research to
help deepen understanding on the subject of investigation.
5.2 Summary of Findings
In establishing employee’s perceived change in conditions of employment, the
study found that out of the 210 respondents who participated in the study, an average of
132(62.96%) projected a deterioration in conditions of employment upon privatisation of
the Company, 42(20.00%) anticipated no change while only 36(17.04%) expected an
improvement in the conditions of employment once the company is privatised. More
specifically, 207(98.57%) of the respondents projected a decrease in job security,
173(82.39%) anticipated an increased workload, 200(95.24%) expected a decline in
recruitment and career progression, and 170(80.96%) projected a decline in teamwork,
while 202(96.20%) expected a reduction in overtime earnings with 195(92.87%)
projecting a reduction in incentives and other benefits to employees once the Company is
privatised thus implying a negative perception held by employees on the planned
privatisation process and that they may reject, resist or delay the process implementation
mainly on the account of the anticipated unfavourable changes in their conditions of
employment given that perception is directly associated with human actions.
74
On the question of employees’ perceived change in the level of involvement in the
firm’s operational decision making, 190(90.48%) of the 210 respondents projected a
decline in the level of employee involvement while only 2(0.95%) respondents projected
an improvement in the level of employee involvement in operational decision making
upon privatisation of the Company. On the other hand, 192(91.56%) of the 210
anticipated a decline in the level of employee involvement in strategic/departmental
decision-making issues upon privatisation of the Company while only 1(0.50%)
respondent projected an improvement in the level of employee involvement in
strategic/departmental decision making on privatisation of the Company. On average 191
(91.02%) respondents out of the 210 reported a projected decline in the level of employee
involvement in both strategic and operational decision-making issues upon privation of
the Company implying that majority of Muhoroni Sugar Company employees perceive a
negative change in the level of employee involvement in the firm’s decision making
issues upon privatisation of the firm. Again these findings can be associated with possible
employee resistance or sabotage to the planned privatisation implementation process.
The study also found that of the 210 respondents, 181(86.19%) reported that
Union-Management relations will deteriorate significantly upon privatisation of
Muhoroni Sugar Company. More specifically, 196(93.33%) respondents reported that
Principals/Management will be less willing to cooperate with the employees’ union in
resolving disputes or problems facing employees while 110(52.39%) felt that
management shall not see cooperation with employees’ union as a vital tool in creating
successful & effective change in the Organisation. These findings imply that majority of
the employees perceive a decline in the status of management-union
75
collaboration/relationships once the Company is privatised hence a negative perception.
The employees’ union may therefore reject, resist or delay the planned change
implementation process on account of the anticipated unfavourable relations between
management and the union upon privatisation of the Company.
On the influence of demographic characteristics on employees’ perceptions on
privatization, the study found that respondent’s job category and academic qualifications
significantly influenced on their responses during the study. For instance, 187(100%) of
the respondents with lower than first degree qualifications projected a decrease in job
security unlike those with first degree qualifications where 3(13.4%) projected no change
in job security. More still, 20(86.96%) of the respondents with a minimum qualification
of first degree projected an increase in basic pay/ remuneration upon privatization of the
Company against a paltry 33(24.77%) for those with lower qualifications. On the other
hand, 59(93.65%) of respondents from the management confirmed that they were aware
of the planned privatisation of the company compared to 130(88.44%) of the union. It
was also established that 34(53.97%) of the respondents from management reported
adequate sensitization levels compared to 50(34.01%) of the unionisable staff.
The study also found that even though 189(90%) of the respondents were aware of
the planned privation of the Company, 126(60%) had the opinion that the sensitization so
far done to the employees on public sector reform policy was inadequate implying that
majority of the employees have insufficient information on the planned privation of the
Company and that their perceptions may be informed by lack of vital information on the
valuable public sector reform policy.
76
5.3 Conclusions
Although privatization brings with it some benefits for the economy, it is equally
important to note its impact on employees as key stakeholders. The concerns of the
employees emanating from perceived unfavourable changes in their conditions of
employment must not be neglected if a successful and smooth privatization is to be
implemented.
In establishing employees’ perceived change in conditions of employment on
privatisation of Muhoroni Sugar Company, the study concludes that majority of the
employees perceive a negative change in their conditions of employment. The apparent
overwhelming negative perceptions being largely informed by concerns on the
anticipated unfavourable changes in the conditions of employment, particularly on job
security, career progression, work load and pressure, basic pay/remuneration, incentives
and other benefits to the employees.
On perceived decision making involvement levels, the study concludes that
majority of Muhoroni Sugar Company employees perceive a decline in the level of
employee involvement in the firm’s decision making issues upon privatisation of the
Company thus implying a negative perception.
On the management-union relations, the study concludes that most of the
Company’s employees perceive a decline in the status of management-union
collaboration/relationships once the Organisation is privatised. The employees’ union
may therefore reject, resist or delay the planned change implementation process on
account of unfavourable projected relations between management and the union upon
privatisation of the Company.
77
The study further concludes that the employees’ perceptions on the planned
privatisation of Muhoroni Sugar Company are significantly influenced both by their job
categories and academic qualifications.
The study also concludes employee sensitization so far conducted on the planned
privation of Muhoroni Sugar Company is inadequate and that majority of the employees
have insufficient information on the planned privation of the Company and therefore their
apparent overwhelming negative perceptions may be informed by lack of vital
information on the valuable public sector reform policy.
Based on the findings of the study, the researcher concludes that majority of the
employees perceive a negative change in their employment system upon privatization and
that since perceptions concerning organizational change processes are significantly
predictive of employees’ reactions to change, the negative perception established in this
study (if not addressed) may be associated with possible rejection or resistance by
employees and their union to the implementation of the planned privatisation process
which might ultimately result into further delay or total abandonment of the entire
initiative.
Finally the study concludes that privatisation as a public sector reform policy is
viable but brings with it far reaching implications especially to the employees of the
privatised firms and that its acceptance and successful implementation is largely pegged
on how well the initiative is planned and executed putting into place strategies and
measures that enhance employees’ and other stakeholders’ participation and process
ownership for sustainability and effectiveness.
78
5.4 Recommendations
Privatisation as a public sector reform policy has been useful in bringing about
performance improvement in the privatised government institutions. However, it has
since remained unpopular especially among the employees based on negative perceptions
and attitudes mainly informed by the anticipated unfavourable changes that come with
privatisation. Employees are always concerned about changes that come with
privatisation that adversely affect their conditions of employment, particularly job
security, workloads, remuneration, career progression, management-union relations, and
levels of employee involvement in institutional decision making among others.
It therefore follows that its acceptance and successful implementation in an
institution is largely pegged on how well the initiative is planned and executed putting
into place strategies and measures that enhance employees’ and other stakeholders
participation and process ownership for sustainability and effectiveness.
Based on the findings of this study, it can be generalized that majority of the
employees hold a negative perception on the planned privatisation of Muhoroni Sugar
Company in particular and that of the state owned Sugar Companies in general.
Therefore, to increase the success of privatisation as a public sector reform policy and to
gain support of the employees and other stakeholders in the implementation process, this
study advances the following recommendations to the implementers and policy makers:
1. The Sugar Industry’s Privatisation Policy Implementing Agencies/Institutions i.e.
PCK, MOA, and KSB should develop and carry out elaborate and effective
employees/stakeholders sensitization programmes on specific planned
79
privatisation initiatives so as to inform the employees and other stakeholders on
the expected gains for enhanced acceptability and success.
2. The Government and the Implementing Agencies/Institutions should make
provisions for significant employee-shareholding in the privatized Company’s
sale agreements.
3. The Implementing Agencies/Institutions and the Investors should sign employee-
retention or no lay-off agreements for a reasonable period of time to a lay the
employees’ fear of immediate job loss in the privatized Company.
4. The Implemented should consider providing for effective employees’ Union
representation in Key Management decision making organs of the privatized
Company.
5. The privatized institution’s Management should provide for merit-based staff
recruitment, promotion & remuneration for enhanced employees’ confidence and
support.
6. The Government and the privatization implementing Agencies/Institutions should
establish and implement effective employee training programmes aimed at
equipping those who might lose jobs due to privatization with appropriate
alternative skills for self-employment, or re-employment into some other public
or private sectors.
80
The findings of this study have led to several contributions to the body of
knowledge as outlined hereunder:
5.5 Contributions to the Body of Knowledge
Research Objectives Contributions to the Body of Knowledge
1. To establish employees’ perceived Negative employees’ perceptions on
change in conditions of employment privatisations is partly informed by the
on privatisation of Muhoroni Sugar anticipated unfavourable changes in their
Company Limited conditions of employment with regard job
security, workloads, remuneration/other
benefits & incentives, and career progression.
2. To explore employees’ perceived Majority of the employees perceive a
change in the level of participation reduction in the level of employee
in decision-making on privatisation involvement in a firm’s decision making
of Muhoroni Sugar Company issues upon privatisation of the Company.
Limited.
3. To establish employees’ perceived Most of employees perceive a decline in the
change in Management-Union status of management-union
collaboration or relationships on collaboration/relationships on privatisation of
privatisation of Muhoroni Sugar the companies. Employees’ union may reject
Company or resist change implementation process on
the account of the unfavourable projected
relations between management and the union
upon privatisation of the Company.
81
4. To examine the extent to which
employees’ Personal Characteristics
influence their perceptions on
privatisation of Muhoroni Sugar
Company.
5. To suggest suitable measures and
strategies that can be employed to
address the employees’ concerns for
enhanced positive perceptions,
attitude and acceptability of the
planned privatisation Muhoroni
Sugar Company.
Employees’ perceptions on privatisation are
significantly influenced both by their job
categories (Union or Management) and
academic qualifications.
Privatisation as a public sector reform policy
is viable but brings with it far reaching
implications to stakeholders especially the
employees of the privatised firm. Its
acceptance and successful implementation is
therefore largely dependent on how well the
initiative is planned and executed putting into
place strategies and measures that enhance
employees’ and other stakeholders’
participation and process ownership for
sustainability and effectiveness.
82
Despite the findings obtained by the study, there are areas that may require further
research to deepen the understanding of the problem and for greater generalization. These
are:
1. This study was specific to employees’ perceptions on privatisation of the Kenyan
Sugar Industry and Muhoroni Sugar Company Ltd in particular. However, there
are other Sugar industry stakeholders whose perceptions might also significantly
affect the privatisation policy implementation in the Sugar industry. It is therefore
suggested that this study be replicated to cover other Sugar Industry stakeholders.
2. Given that the study focused on the perceptions of employees’ of Muhoroni Sugar
Company Ltd, it is suggested that this study be replicated to cover other
Government owned Sugar Companies in the country such as Nzoia Sugar, SONY
Sugar and Chemelil Sugar etc. which are also targeted for privatisation for greater
generalization of the research findings.
3. Whereas the study was specific to the Sugar Industry, a similar study is suggested
but with a focus on other Government owned Companies from sectors other than
the Sugar Industry which are also targeted for privatisation for greater
generalization of the findings e.g. Government Companies from the Energy and
Dairy sectors among others.
4. Having treated Perception as a key factor affecting privatisation process
implementation, it is suggested that further research be done to establish other
important factors that may affect implementation of privatisation initiatives in
Kenya.
5.6 Suggestions for Further Research
83
REFERENCES
Alberto C. and Lopez D.F. (2003). The Truth about Privatization in Latin America. Latin
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91
APPENDICES
Dear Respondent,
APPENDIX I
Letters of Transmittal
P.0 BOX 38-40107,
MUHORONI, KENYA.
Date...........................
RE: REQUEST FOR PARTICIPATION IN A RESEARCH STUDY
I am a student at the University of Nairobi currently pursuing a Masters degree in Project Planning and Management. As part my study, I am required to submit a Research Project Report on employees’ perceptions and attitudes on the impending privatization of Government Sugar Companies: A case of Muhoroni Sugar Company Limited. You are hereby requested to participate in the study by giving information regarding the topic of investigation within two weeks of receipt of the attached questionnaire.
Please note that the information is required purely for academic purposes and will not be used for any other purpose. I further assure you that your name will neither be mentioned nor quoted anywhere during the course of the study and/ or in the final report.
Yours Sincerely,
ODUM WALTER OTIENO
Student Researcher,
University of Nairobi.
92
P. O. BOX 38-40107,
MUHORONI, KENYA.
Date............................
The General Manager,
Muhoroni Sugar Company Limited,
P.O. Box 2, Muhoroni-Kenya.
Dear Sir,
RE: REQUEST TO UNDERTAKE A RESEARCH STUDY IN MUHORONI SUGAR COMPANY LIMITED
I am currently pursuing a postgraduate degree of Masters in Project Planning and Management at the University of Nairobi. As part of my study, I did propose to submit a Research Project Report on Employees’ Perceptions and Attitudes on the planned privatization of Government Owned Sugar Companies: A case of Muhoroni Sugar Company Limited.
I therefore hereby request for your permission to undertake of this research study in your Organization taking into account the ethical and institutional considerations required of a study of this nature. I undertake to comply with all your rules and regulations while within your premises for purposes of this study either personally or through my research assistants.
Please note that the information sought for is purely for academic purposes and will not be used for any other purposes.
Enclosed herein, please find a copy of the questionnaire which shall be administered to the respondents for purposes of this study.
Yours Sincerely,
ODUM WALTER OTIENO
Student Researcher,
University of Nairobi.
93
APPENDIX II
QUESTIONNAIRE
QUESTIONNAIRE NUMBER................................... DATE ISSUED........................
PART I: Personal/ Demographic Information
Names of Respondent (Optional)..........................................................................................
Respondent’s Job Title/Category (Management or Unionisable)..........................................
-Please use a tick (\I) to indicate your preferred answer to the following questions:
1. What is your gender? ( ) Male ( ) Female
2. What is your age bracket? ( ) 18-40 yrs. ( ) 41-55 yrs. ( )over55yrs
3. What is your highest level of education? ( ) “O” level, ( ) “A” level,
( ) Certificate, ( ) Diploma, ( ) First Degree, ( ) Masters & above.
4. For how long have you been in employment? ( ) 4yrs and below ( ) 5-10 yrs.
( ) 11-20 yrs. ( ) Over 20 yrs.
5. For how long have you been working for Muhoroni Sugar Company? ( ) 4 yrs. and
below ( ) 5-10 yrs. ( )ll-20yrs ( )over20yrs.
PART II: Employees’ Perceptions and Attitudes
Q l. In your own opinion what change may occur in the following employees’ conditions
of employment with the privatization of Muhoroni Sugar Company?
-Please use a tick (f) to indicate your preferred answer in table II. A given below.
94
Table II. A: Employees’ Perceived Change in Conditions of Employment.
S/No. Conditions of Employment Shall
Increase
Remain
Unchanged
Shall
Decrease
1. Security of employment
2. Work Load and Pressure
3. Hours Worked per week
4. Basic Pay/ Remuneration
5. Progression (Recruitment & Promotion)
6. Availability of Overtime
7. Level of Teamwork
8. Level of Training to employees
9. Incentives & other benefits
Q2. What is your expectation of the level of employee participation in decision making
on the following issues with the privatization of Muhoroni Sugar Company?
-Please use a tick (\) to indicate your preferred answer in table II. B given below.
Table II. B: Employees’ Perceived Change in the level of Participation in Decision-
Making.
S/No. Issues that require decision making Shall Remain Shall
Increase Unchanged Decrease
1. Operational issues Training
requirements
Pay and Benefits
Hours Worked
95
•a
Manner in which
assigned tasks are
completed.
2 . Strategic/Departmental
issues
o
Hiring of
employees
Dismissal of
employees
Promotion of
employees
Transfer of
employees
Firm Budget and
Finances
Other strategic &
departmental
decisions
Q3. In your own opinion do you agree or disagree with the following statements on the
change likely to occur in the Management-Union collaboration/relationships with the
privatization of Muhoroni Sugar Company Limited?
-Please use a tick ( 1) to indicate your preferred answer in Table II. C given below.
Table II.C: Employees’ Perceived Change in Management-Union
Collaboration/Relationships.
S/No. Management-Union Collaboration Issues Agree Neither Disagree
1. Principals/Management will be more willing to
cooperate with the employees Union in resolving
disputes or problems facing employees
96
2. Employees union will be more willing to cooperate
with Principals /Management on resolving disputes or
problems facing employees
3. Management will see cooperation with employees
Union as a vital tool in creating successful &
effective change in the Organisation
4. Union-Management relations will improve
significantly
5. Union-Management relations will deteriorate
significantly
Q4. In your own opinion, can the following measures help in enhancing positive
employee perception and attitude on the planned privatization of Muhoroni Sugar
Company Limited?
-Please use a YES or a NO to indicate your preferred answer in table II. D given below.
Table II. D: Perceived Strategies and Measures for enhanced positive employees'
Perceptions/ Attitudes on Privatization.
S/No. Measures for Enhanced positive employees perceptions and
attitudes
YES NO
1. Signing of employee retention or no lay-off agreements for a
reasonable period of time to a lay the fear of job loss in the privatized
Company.
2. Providing for significant Employee shareholding in the sale
agreements of the Company.
3. Providing for effective employees Union representation in Key
Management decision making organs of the privatized Company.
4. Providing for Merit-based staff recruitment, promotion & remuneration
97
in tlie privatized Company.
5. Training and equipping employees who might lose jobs due to
privatization with skills for self-employment, or re-employment into
some other public or private sectors.
6. Other Suitable Measures (Please
Specify).................................................................................................................................
PART III: Qualitative Assessment of the Employees’ view of the planned
privatization of Muhoroni Sugar Company Limited.
1. Are you aware of the planned privatization of Muhoroni Sugar Company
Limited? YES/NO
2. In your own opinion, have employees been adequately sensitized about the
planned privatization of Muhoroni Sugar Company Limited? YES/NO.
3. If your answer to Q2 above is YES, was this public sector reform policy
necessary for the Kenyan sugar industry? YES/ NO
4. If your answer to Q3 above is YES, Which of the following (in your opinion) is
the main reason for the privatization of Muhoroni Sugar Company?
a. Reduce Government expenditure on SOEs
b. Improve Performance of SOEs
98
c. Generate revenues from the privatization programme
d. Fulfill IMF, WB and COMESA conditionality
e. Other(Specify):
Thank you very much for the invaluable participation in this study.
99
APPENDIX III
Sample Size Determination Table: Krejcie R. V and Morghan D. W., (1970)
N S N S N S N S N S
10 10 100 80 280 162 800 260 2800 338
15 14 110 86 290 165 850 265 3000 341
20 19 120 92 300 169 900 269 3500 246
25 24 130 97 320 175 950 274 4000 351
30 28 140 103 340 181 1000 278 4500 351
35 32 150 108 360 186 1100 285 5000 357
40 36 160 113 380 181 1200 291 6000 361
45 40 180 118 400 196 1300 297 7000 364
50 44 190 123 420 201 1400 302 8000 367
55 48 200 127 440 205 1500 306 9000 368
60 52 210 132 460 210 1600 310 10000 373
65 56 220 136 480 214 1700 313 15000 375
70 59 230 140 500 217 1800 317 20000 377
75 63 240 144 550 225 1900 320 30000 379
80 66 250 148 600 234 2000 322 40000 380
85 70 260 152 650 242 2200 327 50000 381
90 73 270 155 700 248 2400 331 75000 382
95 76 270 159 750 256 2600 335 100000 384
KEY: “ N” - Population Size
“ S” - Sample Size
100
APPENDIX IV
Authorization Letter
REPUBLIC OF KENYA
NATIONAL COUNCIL FOR SCIENCE AND TECHNOLOGY
RE: RESEARCH AUTHORIZATION
Following your application for authority to carry out research on 'Employees’ perceptions on privatization o f government owned sugar companies: A case o f Muhoronl Sugar Company, Muhoroni Scheme, Kenya, ” 1 am pleased to inform you that you have been authorized to undertake research in Nyando District for a period ending 31" August, 2012.
You are advised to report to the Managing Director, Muhoroni Sugar Company Limited before embarking on the research project.
On completion of Ihc research, you are expected to submit two hard copies and one soft copy in pdf of the research rcporl/thesis to our office.
Telephone: 254-020-2213471. 2241349 254-020-310571, 2213123, 2219420 Fax 254-020-318245,318249 When replying please quote secretaryg® nest .go. Ice
P.0. Sox 30623-00100na ;robi-k6NyaWebsite: www.ncst.go.ke
NCST/RCI)/14/012/602 28lh May 2012O ur Ref: Date:
Walter Otieno Odum University of Nairobi P.O.Box 30197-00100 Nairobi.
DR. M. K. RUG_______DEPUTY COUNCIL SECRETARY
Copy to:
The Managing Director Muhoroni Sugar Company Limited.
j
101
APPENDIX V
Research Permit
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2. G,cancellation bf yuitr permit v (, „ liters will not be interviewed . £?,. ppointiuent. - 'e will be tijed unless It has been :e Vr'cVei-r S' - ling and collection of biological object to further permission from vernment Ministries, t to submit at least two(2)/four(4)fo your final report for Kenyans
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